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The minimum wage in the UK will rise today, 1st October, in the 10^th Anniversary year of the National Minimum Wage (NMW) legislation being passed.

Minimum wage rates for over 21s will rise from £5.52 to £5.73 per hour, whilst the minimum wage for 18 to 22 year olds increases from £4.60 to £4.77, and from £3.40 to £3.53 for those aged 16 and 17.

This latest change represents a total increase of 59% since 1998, compared to a 44% rise in average pay over the same period.  The TUC has stated that more than one million workers will benefit from this rise.

Whilst Impactt applauds the commitment of the government to increase the minimum wage, research indicates that there is still confusion and lack of awareness  amongst small businesses about NMW levels. In addition, workers in particular industries such as hospitality, care and domestic service are often being denied these minimum rates.  A TUC report from December last year indicated that around 150,000 workers were not being paid the legal minimum.  Recent reports of ‘scrooge’ employers also highlighted the widespread use of tips in the restaurant trade to ‘top up’ workers’ wages to NMW levels. 

The minimum wage has undoubtedly benefitted a significant number of low-wage workers in its 10 years of existence.  However, inadequate enforcement of the minimum wage requirements continues to thwart the realisation of the regulation’s full potential.