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Annie Hayes

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Minimum wage hike welcomed

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The National Minimum Wage (NMW) rate is set to rise to £5.73 an hour in October, the government has announced.

The rate will rise from the current £5.52 payable to workers over 22 years of age. The hourly rate for 18-21 year olds will also rise from £4.60 to £4.77, while 16-17 year old employee will see an increase of 13p to £3.53.
Ministers said one million low paid workers, two thirds of them women, will benefit.

Funding for enforcement of the NMW has also been boosted with tough new penalties for rogue employers who underpay staff due to come into force.

The Trades Union Congress have welcomed the move. Brendan Barber, the TUC’s general secretary said: “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.”

Alan Tyrrell, from the Federation of Small Business (FSB) also greeted the news warmly and said: “We are pleased that the government and the Low Pay Commission have heeded the FSB’s past concerns when increases were well above the rate of inflation. A sensibly set National Minimum Wage is in the interests of both employers and employees.”

By October 2008, the NMW will have risen by 59% since its introduction in April 1999, against 47% for average earnings growth.

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Annie Hayes

Editor

Read more from Annie Hayes
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