National Minimum Wage

Chapter 4
Compliance and Operation of the
National Minimum Wage
Introduction
4.1 Compliance remains the cornerstone of the National Minimum Wage (NMW) regime.
Achieving and maintaining a high level of compliance requires widespread awareness and
understanding of the wage arrangements, and also effective enforcement. We set out in this
chapter a number of developments in the areas of awareness, guidance and enforcement, as
well as our recommendations for maintaining compliance.
4.2 We showed earlier in this report that the NMW has more of an impact on particular sectors
of the economy. It also has a greater effect on particular groups of workers. This is because
of such workers’ type of work, the kind of payments they receive, or other aspects of their
work arrangements. In this chapter we look in detail at the functioning of the NMW
arrangements in respect of agency workers; the accommodation offset; migrant workers;
those paid by piece rates; internships, work experience and volunteering; tips; and care
workers. We also report on the latest position with regard to seafarers.
4.3 In addition, as part of our remit, we were asked to consider the implications of the proposed
abolition of the Agricultural Wages Board for England and Wales. We consider this later in
this chapter. The remit also asked us to look at whether the NMW regulations could be made
even simpler and easier to administer. We gave careful consideration to this matter and
consulted widely, and we look at this first.
Operation of the National Minimum Wage –
Simplification
4.4 In this section we look at the evidence we have received in relation to how the minimum
wage could be made simpler and easier to administer. Linked to this, we consider wider
issues in relation to the operational aspects of the wage, for example with regard to agency
workers, where these have arisen in the context of simplification.
A Simple and Straightforward National Minimum Wage
4.5 Having a minimum wage that is simple and straightforward has been one of the guiding
principles for the Commission ever since our first report. We have always regarded this as
important in making the NMW easy to understand, implement and enforce. The Government
has asked us as part of the remit for this report to consider whether the wage arrangements
can be made even simpler. It regards reducing and simplifying regulation as a key priority and,
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