Minimum Wage 2010

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A decision made on 6 November 2009 to approve the Employment Forum's recommendations to increase the minimum wage

Decision Reference: MD-S-2009-0063
Decision Summary Title :	DS - 2010 Minimum Wage		Date of Decision Summary:	2 November 2009
Decision Summary Author:	Kate Morel, Policy Principal		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title :	WR - Minimum Wage Response		Date of Written Report:	2 November 2009
Written Report Author:	Kate Morel, Policy Principal		Written Report : Public or Exempt?	Public
Subject: Employment Forum Recommendation – Minimum Wage Rates for April 2010.
Decision(s): The Minister decided to approve the Employment Forum’s recommendations to increase the minimum wage rate, trainee rate and maximum levels of offset, for implementation on 1 April 2010 and requested that an amendment to the Minimum Wage Regulations and Order be drafted.
Reason(s) for Decision: The Minister received the Employment Forum’s minimum wage recommendation on 23 October 2009 which recommended the following new rates to come into force on 1 April 2010; April 2009 April 2010 Minimum Wage £6.08 £6.20 Trainee Rate £4.56 £4.65 Accommodation offset £66.52 £67.85 Accommodation & food offset £88.69 £90.46
Resource Implications: There are no financial or manpower implications.
Action required: Kate Morel to submit drafting instructions to the Law Draftsman’s Office.
Signature:		Position: Minister
Date Signed:		Date of Decision (If different from Date Signed):

Minimum Wage 2010

Response to the Employment Forum’s Minimum Wage Recommendation

Issued by the Social Security Minister on 2 November 2009

Background

The Employment Forum was established in August 1999 and its role and responsibilities were formalised in the Employment (Jersey) Law 2003, which came into force on 1 July 2005. The Forum has a duty to monitor the economic impact of the Minimum Wage and to make recommendations to the Social Security Minister regarding any future increases. If the Minister decides to not to accept the Forum’s minimum wage recommendations, he must provide a statement to the States explaining his reasons for that decision.

The Forum consulted on the minimum wage during July to September 2009 and presented its recommendations to the Social Security Minister on 23 October 2009.

Summary

The Minister accepts the recommendations of the Employment Forum for the following increases;

	April 2009	April 2010
Minimum Wage	£6.08	£6.20
Trainee Rate	£4.56	£4.65
Maximum accommodation offset	£66.52	£67.85
Maximum accommodation & food offset	£88.69	£90.46

The Minister considers the proposed 2 percent increase (representing 40 percent of average weekly earnings) to be appropriate in the current economic climate and believes that it is more important to protect jobs at this time. The Minister however intends that, when Jersey comes out of recession, it is important that the minimum wage continues to move towards 45 percent of average weekly earnings.

The Minister also approved the Forum’s recommendations on a number of specific issues, in particular;

employers are only permitted to offset charges for food against the minimum wage where three meals per day are provided, with accommodation.
employers are only permitted to offset against the minimum wage a maximum amount for accommodation, and accommodation with food.
the legislation should be amended, as in the UK, to prevent employers from using tips to top up minimum wage pay, effective from 1 April 2011, giving employer’s a year’s notice to change any existing practices.
that neither a student rate nor a youth rate should be introduced.

The Minister intends to request that the required legislation is drafted as soon as possible. This will enable draft Regulations increasing the offsets to be proposed to the States early in 2010, to come into force on 1 April 2010.