LOW PAY COMMISSION WELCOMES NEW TERMS OF REFERENCE AND NEW COMMISSIONER

The Government has issued new terms of reference inviting the Low Pay Commission to prepare a report on a range of issues relating to the National Minimum Wage. This work will be carried out under the chairmanship of Adair Turner.

The Government has also appointed a new Commissioner, Heather Wakefield of UNISON, to take over from Baroness Prosser.

Adair Turner said,

“I am pleased that we have been given this new remit which reflects some of the points we highlighted in our recent report. One key issue we will be looking at this year is the minimum wage treatment of benefits-in-kind, including those offered as part of a salary sacrifice scheme. This is a concern that several employers raised during the preparation of our 2005 Report.

“In carrying out our work for this report we are keen to hear from all those with an interest or experience of the issues identified in the terms of reference. We will consult widely with our stakeholders by inviting written comments and through a series of meetings and regional visits. The deadline for written comments is Friday 30 September 2005.

“I am also very pleased to welcome Heather Wakefield onto the Commission. I am sure she will make a valuable contribution. Heather replaces Baroness Margaret Prosser to whom I would like to offer my sincere thanks for the significant contribution she has made to the Commission’s work.”

Notes to Editors

1.       The Low Pay Commission is a statutory body whose role is to advise the Government on the National Minimum Wage.

2.       The Commission has produced six reports.  These are available from the Stationery Office Bookshops or the Commission’s website at: http://www.lowpay.gov.uk

3.       The members of the Low Pay Commission are:
Adair Turner (Chairman), Vice-Chairman, Merrill Lynch Holdings Ltd; Ian Brinkley, Chief Economist and Head of Economic and Social Affairs Department, Trades Union Congress; Professor William Brown CBE, Professor of Industrial Relations and Master of Darwin College, University of Cambridge; John Cridland, Deputy Director-General, CBI; Paul Gates OBE, Deputy General Secretary, Community; Ian Hay OBE, Chairman, Food Trade Association Management; Professor David Metcalf, Professor of Industrial Relations, London School of Economics; Heather Wakefield, Head of Local Government, UNISON; and Angie Risley, Board Member, Whitbread Group PLC. 

4.       The National Minimum Wage for those over 21 is £4.85 per hour. For those aged 18 to 21 or over 21 but in the first six months of a new job with a new employer and receiving accredited training, the rate is £4.10 per hour. The Government has accepted the Commission’s recommendation that there hould be further increases to £5.05 and £4.25 respectively from 1 October 2005. The minimum wage for 16 and 17 year olds of £3.00 an hour will remain the same in 2005.

Low Pay Commission
8th Floor
Oxford House
76 Oxford Street
LONDON
W1D 1BS

Tel. 020 7467 7279

http://www.lowpay.gov.uk/

NATIONAL MINIMUM WAGE

The Low Pay Commission is asked to:

· consider whether the October 2006 upratings of the adult and development rates recommended in their 2005 Report remain appropriate in the light of economic circumstances and the other factors identified as relevant in that Report, and if not make any recommendations for change;

· review the level of the 16-17 year old rate, keeping in mind the position of the youth labour market and the incentives for young people to participate in education and training;

· review the operation of the accommodation offset and if appropriate make recommendations for any changes needed to the regulations; and

· review the treatment of benefits in kind, including where those benefits are offered as part of a salary sacrifice arrangement.

The Commission is asked to report to the Prime Minister and the Secretary of State for Trade and Industry by the end of February 2006.

The Government will review the position on the older workers’ Development Rate and the way the exemption applies to older apprentices, working closely with the Commission, in good time for these issues to be addressed - if appropriate - in the forthcoming age discrimination regulations.