The Government has made changes to the Low Pay Commission (LPC)’s remit for their 2012 report.
While stating clearly that the Government supports the NMW, it has asked the LPC to focus on certain matters in this year’s review. Given the high level of unemployment among the under 30s, the Government has asked the LPC to review the NMW in light of the position of young people in the labour market. As such, the most likely area for change is in relation to the minimum wage for apprentices and those entitled to the young workers (16 and 17 year olds) or development rate (18, 19 and 20 year olds) of the NMW.
As well as young people, the main concern for the LPC in preparing this year’s report is whether the NMW can be made simpler and more certain. The remit notes that this may involve the removal of elements of the NMW, and it has been suggested that this may mean the abolition of the Agricultural Wages Board. Employers will no doubt welcome any move towards greater certainty as to future levels of NMW, as the new rates are currently only announced a year in advance.
The final LPC report for 2011-12 is not due until the end of February 2012 and we will keep you up to date with any developments. In the meantime, the NMW will rise on 1 October 2011 in line with the 2011 report when the standard rate will increase to £6.08 per hour, the development rate to £4.98 per hour and the young workers rate to £3.68 per hour.