National minimum wage moves a step nearer

Draft Regulations governing the detailed application of the UK's national minimum wage were laid before Parliament in February 1999 and will come into force from the beginning of April. Employers' organisations have welcomed modifications made by the government, but trade unions and low pay campaigners are unhappy that there will be no obligation to state the national minimum wage on workers' payslips.

On 16 February 1999, the trade and industry secretary, Stephen Byers, laid draft Regulations before Parliament which will give effect to the national minimum wage (NMW) from 1 April 1999. As previously announced (UK9807135F), the standard hourly rate of the NMW will be GBP 3.60 for workers aged 22 and above, with a rate of GBP 3.00 for those aged 18-21 and GBP 3.20 for new employees undertaking training. The publication of the Regulations follow consultations on an earlier draft (UK9809152N). The main changes made by the government to its original proposals are that:

• there will be no requirement to state the NMW on payslips;

• employers' record-keeping obligations are less onerous than originally proposed;

• wider exemptions from the NMW will apply, including people living and working as part of a family (for example, au pairs); and

• the hourly earnings of workers with annualised hours arrangements will be averaged over a year.

In a statement, Mr Byers said that he believed the Regulations "represent a reasonable balance between providing necessary protection for workers and avoiding unnecessary burdens on businesses and individuals".

The Government's rethink was welcomed by employers' bodies. The Confederation of British Industry and the Engineering Employers' Federation said that the changes to the NMW Regulations were "common sense" and would help keep down the paperwork facing employers.

However, trade unions and campaigners against low pay are concerned over the Government's decision not to require that workers' payslips carry details of their minimum wage entitlements. The Trades Union Congress (TUC) said that "our key concern is that the Government makes sure that low paid employees are made aware of their rights and given easy redress if their pay falls short of the new minimum." Survey results released by the TUC in January suggested that four out of five young people were unaware of the GBP 3.00 NMW rate for 18-21 year-olds. The Low Pay Unit believes that the change will jeopardise self-enforcement of the NMW and encourage low-paying employers to flout the new law.

Ministers have said that it is "essential for as many workers and employers as possible to know their rights and obligations". The Department of Trade and Industry is to issue detailed guidance on the Regulations and will be backing this up with a GBP 5 million publicity campaign in the run-up to the NMW's 1 April implementation date.