The adult rate of the national minimum wage will be extended to 21 year-old workers from October 2010 (subscription required) (it is currently paid to workers aged 22 and over). This means that workers who have turned 21 prior to 1 October and who are receiving the national minimum wage when the 2010/2011 national minimum wage uprating comes into effect can look forward to an increase that is effectively worth (what is likely to prove to be) an inflation-busting 22.8%.
Any 21 year old workers in this particular group will see their rates of pay increase from £4.83 per hour (the "youth development rate" currently paid to workers aged 18 to 21) to £5.93 per hour (the new national minimum wage adult rate, effective from 1 October 2010. This represents an increase of 22.8%.
Personneltoday.com reports that the Government estimates that around 85,000 21-year olds will be affected by the extension of the national minimum wage adult rate, at an estimated cost to employers of £48.2 million.
The extension of the national minimum wage adult rate to cover 21 year olds from 1 October 2010 is among a number of changes confirmed by the Government's publication late last month of the National Minimum Wage Regulations 1999 (Amendment) Regulations 2010.
National minimum wage rates for 2010/2011
As a result of the 2010/2011, national minimum wage uprating, the following changes will come into effect from 1 October 2010:
The 2010/2011 national minimum wage increase - which will see the adult rate increase by 2.2% to £5.93 per hour (up from its current rate of £5.80 per hour) with effect from 1 October 2010 - was originally announced in Alistair Darling's final Budget on 25 March 2010.
Update (Sunday 8 May 2011): National minimum wage 2011/2012: How will the 2.5% increase to £6.08 for October 2011 stack up against inflation? With private sector pay expectations subdued, the 2011/2012 national minimum wage increase could prop up whole economy pay awards in the closing months of 2011. But how will it compare with inflation? It was announced on Thursday 7 April 2011 that the national minimum wage adult rate will increase to £6.08 per hour for 2011/2012, with effect from 1 October 2011. This represents an increase of 2.5% from the 2010/2011 national minimum wage adult rate, which currently stands at £5.93 per hour (from 1 October 2010 to 30 September 2011). The 2011/2012 national minimum wage adult rate (at £6.08 per hour) is therefore set 15p per hour higher than the 2010/2011 rate. The BBC's Robert Peston commented via Twitter that the "announced increase in the [national] minimum wage of 2.5% to 608p is considerably less than current rate of inflation."
Personneltoday.com reports that the Government estimates that around 85,000 21-year olds will be affected by the extension of the national minimum wage adult rate, at an estimated cost to employers of £48.2 million.
The extension of the national minimum wage adult rate to cover 21 year olds from 1 October 2010 is among a number of changes confirmed by the Government's publication late last month of the National Minimum Wage Regulations 1999 (Amendment) Regulations 2010.
National minimum wage rates for 2010/2011
As a result of the 2010/2011, national minimum wage uprating, the following changes will come into effect from 1 October 2010:
- The national minimum wage adult rate will rise from its current level of £5.80 per hour to £5.93 per hour, an increase of 2.2%.
- The national minimum wage "youth development rate" (for workers aged 18 to 20) will rise from £4.83 per hour to £4.92 per hour (an increase of 1.8%). This increase is based on the projected rise in consumer prices index (CPI) inflation.
- The national minimum wage youth rate (for workers aged 16 and 17) will rise from £3.57 per hour to £3.64 per hour (an increase of 1.9%). This increase is also based on CPI forecasts;
- An apprentice minimum wage rate of £2.50 per hour will be introduced. The Low Pay Commission's (LPC) 2010 report recommended that the apprentice rate be "applied as a single rate to those apprentices currently exempt from the National Minimum Wage. That is all those under the age of 19 and those aged 19 and over in the first 12 months of their apprenticeship. The wage should cover both those employed on traditional contracts of apprenticeship and employed apprentices on government-supported Level 2 and 3 schemes."
The 2010/2011 national minimum wage increase - which will see the adult rate increase by 2.2% to £5.93 per hour (up from its current rate of £5.80 per hour) with effect from 1 October 2010 - was originally announced in Alistair Darling's final Budget on 25 March 2010.
Update (Sunday 8 May 2011): National minimum wage 2011/2012: How will the 2.5% increase to £6.08 for October 2011 stack up against inflation? With private sector pay expectations subdued, the 2011/2012 national minimum wage increase could prop up whole economy pay awards in the closing months of 2011. But how will it compare with inflation? It was announced on Thursday 7 April 2011 that the national minimum wage adult rate will increase to £6.08 per hour for 2011/2012, with effect from 1 October 2011. This represents an increase of 2.5% from the 2010/2011 national minimum wage adult rate, which currently stands at £5.93 per hour (from 1 October 2010 to 30 September 2011). The 2011/2012 national minimum wage adult rate (at £6.08 per hour) is therefore set 15p per hour higher than the 2010/2011 rate. The BBC's Robert Peston commented via Twitter that the "announced increase in the [national] minimum wage of 2.5% to 608p is considerably less than current rate of inflation."
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