ACS Calls for Strong Enforcement against Minimum Wage Avoidance

The Office for National Statistics has published new information on the number of UK jobs that pay less than the National Minimum Wage or National Living Wage.

The statistical bulletin reports that there are an estimated 362,000 jobs which pay less than the minimum (NMW or NLW), 178,000 of which are full time. By sector, the hairdressing industry was reported to have the highest proportion of low-paid jobs, in which 7.0% of jobs were paid below the minimum wage rate in April 2016.This is followed by the childcare, hospitality and cleaning industries, in which 4.0%, 3.8% and 3.7% of jobs respectively were paid below the minimum wage rate. 2.2% of jobs in the retail sector were reported to be paid below the minimum.

ACS chief executive James Lowman said: “We remain concerned about the impact of the National Living Wage on retail businesses, but there needs to be a level playing field where all businesses pay at least the nationally set rate.  We support strong enforcement of the law to ensure that businesses do not gain an unfair competitive advantage by underpaying their staff.”

Evidence from ACS’ submission to the Low Pay Commission earlier this year showed that convenience store retailers are already cutting back as a result of the introduction of the National Living Wage, with 67% of retailers reporting that they are reducing the number of staff employed in their business and 15% saying that their business is less competitive as a result of the £7.20 rate.

The current rates of the National Minimum Wage and National Living Wage are as follows:

  • National Living Wage (staff aged 25 and over): £7.20 per hour
  • Adult rate (NMW, 21-25): £6.95 per hour
  • Youth development rate: £5.55 per hour
  • 16-17 year old rate: £4,00 per hour
  • Apprentice rate: £3.40 per hour

The Government remains committed to rising the National Living Wage to 60% of median earnings by 2020. The Low Pay Commission are due to make recommendations on 2017 wage rates later this month.

This entry was posted by Leah on Wed, 26/10/2016 - 12:33