The TUC is warning that the national minimum wage (NMW) risks leaving younger workers behind, as it gives evidence to the Low Pay Commission (LPC) today (Thursday 14th September 2014).
An increase to the minimum wage will come into force in April 2018, but the new top rate will only apply to workers over 25.
The TUC is calling for:
- the top rate of the minimum wage to be extended to all workers aged 21 and above
- the rates for 16 to 20-year-olds to be increased, and
- for more resources for enforcement to ensure the new higher rate is being paid to all who qualify.
As the 21-24 rate is growing more slowly that the amount paid to older workers, TUC analysis reveals that the gap between the pay of people in this age group and those over 25 has widened by more than £400 a year.
The TUC published research last week that one in eight working people are skipping meals because they can’t afford to eat, and will also warn the LPC today that the proposed rise in the NMW will not be enough to combat in-work poverty.
The TUC argues that with high levels of employment and record corporate profits, employers can afford a strong increase in the minimum wage, and that the LPC should be bold in its recommendation of a new rate to government.
TUC General Secretary Frances O’Grady said:
“Minimum wage pay rates aren’t increasing fast enough and the government’s target of £9 an hour by 2020 now seems a fantasy.
“Younger workers deserve to be treated fairly. Why are 21 to 24-year-olds getting less pay than their colleagues for the same work, when they face the same expenses as other adults and are highly productive?
“The minimum wage needs a serious boost in the coming years, especially for younger workers. With employment, the economy and earnings set to grow next year, employers will be able to afford a decent rise. And higher rates will need to be properly enforced to be meaningful.
“I’d also encourage more employers to adopt the real Living Wage standard. Not only will it be good for their workers, but to help attract and retain talent.”
On pay, the TUC wants to see:
- The LPC go beyond the government’s target of 60% of median earnings by 2020 for workers aged 25 and above, and get the NMW rate to £10 as quickly as possible.
- 21-24 year olds be paid the full NMW rate (including the “national living wage” supplement).
- The rates for younger workers should narrow the gap between adults and younger workers as quickly as can be sustained.
- The apprentice rate should be raised to the level of the young workers rate.
- The apprentice rate should only apply to those undertaking intermediate level apprentices who are aged 16-18 and to 19-20 year olds in the first year of their apprenticeship.