National Minimum Wage

National Minimum Wage
4.12 In addition to the evidence we gathered, the Government said it would forward to us ideas to
simplify the NMW which emerged from its Employment-Related Law spotlight in the Red
Tape Challenge. This invited proposals during a two week period in October 2011. Officials
from the Department for Business, Innovation and Skills (BIS) subsequently informed us that
the process generated very little interest in the NMW, and identified no problems with the
regulations. The few comments that were received were mainly on the level of the rate
(including making it a living wage). We set out elsewhere in this report the importance of the
NMW as a wage-floor for the low paid. Our aim in making our recommendations each year is
to help as many low-paid workers as possible without any significant adverse impact on
employment or the economy. We have not therefore explored suggestions likely to add
significantly to the regulatory costs on business or substantially reduce the labour market
protections for the lowest paid, such as abolishing the NMW entirely.
4.13 By far the most common response from stakeholders who called for any action on
simplification were requests to improve both the format and content of the official guidance
in order to raise both businesses’ and workers’ understanding of the application of NMW
rules in particular settings. In the course of this chapter we identify a number of specific
areas where better dissemination of the information would help both employers and workers.
We now go on to consider those areas.
Agency Workers
4.14 Agency workers are fully entitled to the minimum wage but, until recently, were not entitled
to the same pay and conditions as directly employed staff. The Agency Workers’ Regulations
(AWRs), implemented in October 2011, provide for equal treatment to apply after a worker
has been in a given job for 12 weeks. This new provision might lead to some workers
receiving higher wages.
4.15 In our 2011 Report, we referred to the banning of upfront fees for photographic and fashion
models that came into effect in October 2010. We also reported on employer groups’
concerns about the likely additional costs as a result of the introduction of the AWRs. We
noted that the Government was taking forward its work on sector-specific guidance for the
entertainment sector (following a recommendation we made in 2010), which it intended to
publish by spring 2011. This recommendation had been made in recognition of the complex
nature of this sector, for example the tax status of individuals, the diversity of opportunities
(fringe theatre, student films, etc.) and the fact that both HMRC and the Employment Agency
Standards Inspectorate had an involvement in the sector.
4.16 The Government has updated and clarified its online guidance on the banning of upfront fees
and the use of internships and work experience (including the provision of an entertainment
sector-based example). It said that views from entertainment sector-based organisations
were sought and considered in producing the guidance.
4.17 Equity has been critical of the Government’s response to our previous recommendation. It
said that although the revised guidance was marginally helpful, it only provided one example
of an actor who worked unpaid in a short film and that as this was very specific it was unclear
how this advice could be applied to other areas. Equity wanted to see the Government revisit
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