National Minimum Wage

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Contents Naming 121 Prosecutions 122 Informal Economy and Non-compliance 122 Enforcement Statistics 123 Resources 125 Awareness 125 Conclusion 127 5 Setting the Rate 129 Appendices Introduction 129 Economic Prospects 129 Prospects for Growth 129 Prospects for Prices, Pay and Earnings 133 Prospects for Employment 137 Stakeholder Views 139 Adult Rate 139 Youth Rates 141 Apprentice Rate 141 Implications of Other Government Legislation 143 Pension Reforms 143 Changes to Personal Tax and Benefits System 144 Abolition of the Agricultural Wages Board for England and Wales 145 International Comparisons 145 Clarity 146 Recommended Rates 147 The Adult Rate 148 The Accommodation Offset 148 The Youth Development and 16-17 Year Old Rates 148 The Apprentice Rate 149 Implications of the Recommended Rates 149 Coverage 149 Position Relative to Average Earnings 151 Impact on Household Income 151 Wage Bills 152 Exchequer Impact 152 Conclusion 153 1 Consultation 155 2 Low Pay Commission Research 159 3 Minimum Wage Systems in Other Countries 173 4 Main Data Sources 179 References 183 v
Commissioners’ Introduction Last year we welcomed the fact that the National Minimum Wage (NMW) is now widely accepted, but noted too that its effects need to be constantly monitored. The twelve months since then have justified our cautionary words: they have been challenging for the economy and the labour market. It has been more important than ever to ensure our recommendations are grounded in a careful assessment of the evidence, and to look carefully for any evidence that the lengthening period of low economic growth may give rise to new or different impacts of the NMW. Although the NMW itself continues to be widely accepted, the range of beliefs about appropriate rates has if anything widened. Falling real incomes have reinforced the opinions of many who favour substantial increases. Difficult trading conditions, subdued consumer spending, and squeezed public sector budgets have strengthened the views of those calling for caution. Remit This is the thirteenth Low Pay Commission report. Our remit from the Government asked us to monitor, evaluate and review the NMW and to report to the Prime Minister and the Secretary of State for Business, Innovation and Skills by the end of February 2012 on the following matters, taking account of the economic and labour market context, including pension reforms: ●● the level of each of the different rates of the NMW with recommendations on the appropriate levels from October 2012; ●● the labour market position of young people, including those in apprenticeships and internships; ●● the scope to simplify the NMW, and the effect of the proposed abolition of the Agricultural Wages Board for England and Wales; ●● how to give business greater clarity on future levels of the NMW; and ●● whether any of the other recommendations could be introduced more promptly. vi
Page 1 and 2: Published by TSO (The Stationery Of
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Page 9 and 10: The Commissioners David Norgrove (C
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Chapter 2: The Impact of the Nation
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Research on Earnings and Pay Chapte
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Hours Chapter 2: The Impact of the
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Births and Deaths of Firms Chapter
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Views on Competitiveness Prices Cha
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Costs 2.139 Those representing busi
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Chapter 3 Young People, Interns and
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Chapter 3: Young People, Interns an
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Figure 3.6: Economic Activity of 18
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Research Chapter 3: Young People, I
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Views on Impact Chapter 3: Young Pe
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National Minimum Wage 102 through e
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National Minimum Wage 4.12 In addit
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National Minimum Wage 106 physical
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National Minimum Wage 4.32 Some sta
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National Minimum Wage 4.40 The majo
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National Minimum Wage Care Workers
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National Minimum Wage 114 ●● Gu
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National Minimum Wage 4.65 We have
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National Minimum Wage 118 supported
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National Minimum Wage 4.83 In its e
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National Minimum Wage 122 yet been
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National Minimum Wage 4.104 Figure
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National Minimum Wage 4.112 Followi
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National Minimum Wage 4.122 Stakeho
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National Minimum Wage 130 growth by
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National Minimum Wage 132 Figure 5.
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National Minimum Wage 134 so-called
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National Minimum Wage 5.23 We concl
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National Minimum Wage 5.32 The rece
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National Minimum Wage 5.40 The CBI
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National Minimum Wage 5.51 Generall
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National Minimum Wage 5.60 Usdaw po
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National Minimum Wage 5.70 This yea
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National Minimum Wage 148 could ris
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National Minimum Wage 150 using bot
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National Minimum Wage Wage Bills 5.
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Appendix 1 Consultation We are grat
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Interns Anonymous Jack McPhee Jeary
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Appendix 2 Low Pay Commission Resea
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Appendix 2: Low Pay Commission Rese
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Appendix 2: Low Pay Commission Rese
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Table A2.1: Low Pay Commission Rese
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Project title and researchers The S
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Project title and researchers An As
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Research Programme for the 2013 Rep
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National Minimum Wage Table A3.1: C
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National Minimum Wage Figure A3.1:
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National Minimum Wage Figure A3.3:
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National Minimum Wage 5 The ASHE 20
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National Minimum Wage Inflation and
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National Minimum Wage CBI, ongoing.
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National Minimum Wage Dickerson, A.
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National Minimum Wage HM Treasury,
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National Minimum Wage Office for Na
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National Minimum Wage XpertHR, 2011
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National Minimum Wage

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