date: 5 March 2008

embargo: immediate release

TUC welcomes minimum wage boost

Commenting on the Low Pay Commission's (LPC) report and announcement today (Wednesday) that the adult minimum wage will increase by 3.8 per cent to £5.73 an hour from October 2008, TUC General Secretary Brendan Barber said:

'We welcome this increase in the minimum wage, which will benefit more than a million low paid workers.

'The Low Pay Commission was right to withstand pressure from business warning of economic trouble ahead. The truth is that employers will be able to absorb these sensible increases without too much difficulty.

'The LPC must continue to recommend the highest minimum wage increases that can be sustained as it provides very important protection for low paid workers.

'Bosses who fail to pay the minimum wage leave vulnerable workers in poverty and undercut the majority of employers who are happy to obey the law. Everybody stands to gain from making the minimum wage as robust as possible. We support the improvements to the enforcement regime that are currently going through parliament, and look forward to the introduction of tougher penalties for cheating employers and fair arrears for underpaid workers later in the year.'

NOTES TO EDITORS:

- The LPC has today announced that the minimum wage rates will increase from 1 October 2008 (see table below):

- The minimum wage can be enforced by complaint to HM Revenue and Customs (HMRC) national minimum wage (NMW) enforcement unit, which has more than 100 inspectors at its disposal.

- The HMRC NMW helpline 0845 6000 678 is open Monday to Friday 9am-5pm. All calls are taken in strict confidence and callers can be assisted in 30 different languages. You can also download a complaint form at http://www.hmrc.gov.uk/nmw/nmw_complaint_form.pdf

- Only complaints that name the workers involved can receive feedback on the progress of the complaint from HMRC, but complaints from third parties and anonymous complaints are also investigated.

- HMRC has the authority to impose enforcement notices and penalty notices on employers who break the law. An enforcement notice requires the employer in question to pay the NMW. Penalty notices are imposed on employers who fail to comply with enforcement notices. A penalty notice imposes a charge of £224.70 per underpaid worker. HMRC can also prosecute employers, but this is used as a last resort because the penalty notice system is quicker than taking a case to court.

- The Employment Bill 2007 includes significant improvements to the minimum wage enforcement regime. It is proposed that the maximum penalty for breaking the NMW Act will be increased from £5,000 to an unlimited fine. In addition, it is proposed that all arrears due to workers should be paid at the current minimum wage rate, which will benefit low paid workers caught up in long-running underpayment cases. These measures are likely to take effect on 1 October 2008.

- The UK minimum wage - international comparisons

Source: LPC Report and ONS ASHE 2007

- Luxembourg is often considered a poor comparator for the UK because it is quite a small and rich country, but it is worth noting in passing that it currently has a minimum wage of £6.96 for adults aged 18 and above (exchange rate at 3 March 2008).

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Contacts:

Media enquiries:
Liz Chinchen T: 020 7467 1248 M: 07778 158175 E: media@tuc.org.uk
Rob Holdsworth T: 020 7467 1372 M: 07717 531150 E: rholdsworth@tuc.org.uk
Elly Brenchley T: 020 7467 1337 M: 07900 910624 E: ebrenchley@tuc.org.uk

Press release (700 words) issued 5 Mar 2008