minimum wage increases again

Today marks another above inflation increase for everyone on the minimum wage in the UK.

The minimum rate for employees aged between 18 and 21 has increased by 20 pence to £4.45, while 16 to 17-year-olds will now receive £3.30, a rise of 30p or 10%. The “adult minimum wage” for those over 21 has also increases by 30p and these people now receive £5.35 per hour.

As expected, there are differing views between employers and employee unions. The CBI says that the minimum wage has increased 21%  since 1992 and is looking for a more modest increase in the future so that employers can factor this in when budgeting and also to attempt to better absorb previous increases.

The rate for 18-21 year olds began at £3 in April 1999 and now stands at £4.45 which is a near 50% increase since the legislation was introduced. Where inflation has increased by a modest 17% in the same period (using data from national statistics).

However, the revenue and customs department of the government says in a recent crackdown that they have recovered more than £1.3m for workers who were still not receiving the correct minimum wage.

It is estimated that at least 170,000 workers in the UK still do not receive the correct rates as prescribed in the minimum wage legislation. The government minister in charge, Jim Fitzpatrick says that there would be further crackdown on employers who “mistreated vulnerable workers”.

Additionally the TUC said that companies that broke the law should be “named and shamed” and they should also face tougher penalties if they did not abide by the law.

Jim Fitzpatrick went on to say

“Millions of working people have directly benefited from the decent minimum standards we have put in place, like the minimum wage.

“This has given employees the security of knowing they can expect fair treatment, wherever they work.

“I want everyone to be aware of the rights they have in the workplace, as a step towards ending unfair treatment and discrimination.”