According to the Department for Business , Innovation & Skills, over 1 million of Britain’s lowest-paid workers are set to benefit as the New Minimum Wage (NMW) rates come into force from 1 October 2014
It has been six years since the last real value increase in the adult rate minimum wage, the largest increase seen since 2008.
The independent LPC (Low Pay Commission), was established following the National Minimum Wage Act 1998 to advise the government on the National Minimum Wage.
The commission is made up of representatives from all sides of industry. The latest NMW recommendations to take affect from October 1st 2014, follow consultation with academics, businessess and workers representatives, together with extensive research and analysis.
In reaching its recommendations, the LPC “balanced the need to protect the earnings and jobs of low paid workers against the difficulties faced by employers and businesses, paying particular attention to the employment prospects of young people”.
The LPC predicts “that an increase in line with its recommendation would increse the number of jobs covered by the minimum wage by over a third, to around 1.25 million and would lift NMW workers’ pay relative to other earnings too.
The new National Minimum Wage rates from 1 October 2014 are:
– for workers 21 yrs and over – 3% increase from £6.31 to £6.50 per hour
– for workers 18-20 yrs – 2% increase from £5.03 to £5.13 per hour
– for workers 16-17 yrs – 2% increase from £3.72 to £3.79 per hour
– for apprentices – 2% increase from £2.68 to £2.73 per hour
In short, a worker on the adult minimum wage rate working a 36-hour week, 52 weeks a year, would receive £355 a year more in their pay packet under the new £6.50 per hour minimum wage rate as of October 2014.