March 17 2015 - Changes to national minimum wage rates will take effect from October 1 2015:
- The adult (aged 21 and over) minimum wage rate will increase from £6.50 to £6.70 an
- The 18-20 rate will increase from £5.13 an hour to £5.30 an hour to
- The minimum wage for 16-17 year olds will increase from £3.79 an hour to £3.87 an hour
Apprentice pay will increase from £2.73 an hour to £3.30 - rejecting the Low Pay Commission's lower recommendation.
David Norgrove, Chair of the Low Pay Commission, said:
"We carefully weighed the risk of doing too little to raise the earnings of the lowest paid against the risk of recommending more than business and the economy can afford. Our recommendation that the adult minimum wage increase by 3 per cent to £6.70 an hour is likely be the largest real-terms increase in the NMW since 2007 taking its estimated real value three-quarters of the way back to its highest ever level. It should also represent a further increase in the value of the minimum wage relative to average earnings, which is already at a record level.
"We judge that the improved economic and labour market conditions mean once again that employers will be able to respond in a way that supports employment. However, our recommendation this year is predicated on a forecast which foresees lower costs for business in fuel and energy, a strong economic performance, significant recovery in earnings across the economy and rising productivity. If these expectations are not borne out over the year we will take this into account when considering next year's recommendation.
"While we welcome the government's response on the headline rates we are disappointed that it has not accepted our recommendation on the level of the Apprentice Rate. We based our judgement on a careful assessment of the evidence, seeking to benefit apprentices while also protecting the supply of places"