Employment (Minimum Wage) (Amendment No.5) (Jersey) Regulations 200-

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A decision made (05.12.2008) to lodge the Employment (Minimum Wage) (Amendment No.5) (Jersey) Regulations 200-

Decision Reference: MD-S-2008-0083
Decision Summary Title :	L:\General Information\Workgroups\Policy\Employment\Ministerial decisions\DS 2009 MW Regs 1Dec08		Date of Decision Summary:	1 December 2008
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 :	L:\General Information\Workgroups\Policy\Employment\ \Ministerial decisions\ SD MW Regs 1Dec08		Date of Written Report:	1 December 2008
Written Report Author:	Kate Morel, Policy Principal		Written Report : Public or Exempt?	Public
Subject: Employment (Minimum Wage) (Amendment No. 5) (Jersey) Regulations 200-
Decision(s): The Minister decided to lodge the Employment (Minimum Wage) (Amendment No. 5) (Jersey) Regulations 200- to increase the maximum amounts that may be offset against the minimum wage for accommodation and food, effective from 1 April 2009.
Reason(s) for Decision: The Minister had approved the Employment Forum’s recommendation that the maximum amount that an employer may offset against the minimum wage where accommodation is provided to an employee should be increased to £66.52 per week, or £88.69 per week where both food and accommodation are provided. The Minister intends that the minimum wage will be increased to £6.08 and the trainee rate will be increased to £4.56 by Ministerial Order, subject to the States adopting this amendment to the Regulations.
Resource Implications: There are no financial or manpower implications.
Action required: Greffe to lodge the Proposition for States debate in January 2009.
Signature:		Position:
Date Signed:		Date of Decision (If different from Date Signed):

Employment (Minimum Wage) (Amendment No.5) (Jersey) Regulations 200-

Accompanying report for the Employment (Minimum Wage) (Amendment No. 5) (Jersey) Regulations 200-

Introduction

Jersey’s Minimum Wage has been in force since 1st July 2005. On the basis of the Employment Forum’s recommendation, the Social Security Minister proposes that the amounts that may be offset against the minimum wage should be increased via this amendment to the Minimum Wage Regulations.

The Minister proposes that, subject to the States approval of the draft amendment, the minimum wage and trainee rate would be increased by Ministerial Order, to be effective from 1 April 2009.

Background

The independent consultation body, the Employment Forum presented its recommendation to the Minister on 30 October 2008, which is attached at Appendix 1. The Minister responded to the Forum’s recommendations on 1 December 2008 and that response attached at Appendix 2. In summary, the Forum recommended the following increases:

	1st April 2008	1st April 2009
Minimum Wage	£5.80	£6.08
Trainee Rate	£4.35	£4.56
Accommodation offset	£63.47	£66.52
Accommodation & food offset	£84.63	£88.69

Offsets

Regulations may be made under Part 4 of the Employment (Jersey) Law 2003 specifying permissible offsets against the minimum wage, requiring that all employees in Jersey are paid at an hourly rate which is equal to or greater than the minimum wage. The Regulations ensure that the ability to offset benefits in kind against weekly wages is limited only to charges made by the employer for living accommodation, or living accommodation with food.

The Forum recommended that the two offsets should be increased by the same percentage as the minimum wage rate, 4.8% to avoid the distortion effects that would occur if the rates were increased in isolation.

This proposed amendment to the Regulations would increase the maximum value that may be attributed to the two benefits in kind, effective from 1st April 2009, for the purpose of establishing whether the minimum wage has been paid:

 For the provision of accommodation to the employee, the maximum weekly offset against the minimum wage would be £66.52.

 For the provision of both accommodation and food to the employee, the maximum weekly offset against the minimum wage would be £88.69.

Minimum wage rates

Subject to States approval of the proposed Regulations, the Social Security Minister proposes that an Order would be made under Article 16(3) of the Employment (Jersey) Law, 2003, to apply the following rates from 1st April 2009;

 An hourly minimum wage of £6.08, to apply to all employees over school leaving age, except when the trainee rate is paid, and ‘special classes of person’, which includes share fishermen, residential members of religious communities, and others as detailed in articles 36 to 43 of the Employment Law.

 An hourly trainee rate of £4.56 which may be paid to an employee over school leaving age, who is undertaking an accredited course of training for a maximum period of one year, when in a new job, with a new employer, by written agreement.

There are no financial or manpower implications arising from this proposition.