In its annual submission to the Low Pay Commission (LPC), the TUC will today recommend an increase in the adult National Minimum Wage to £5.35 for next October, rising towards £6 by October 2006.
These increases would lift the National Minimum Wage by more than the projected growth in earnings and benefit up to two million workers.
In its evidence, the TUC will point out that previous increases in the minimum wage have benefited fewer than the LPC’s target of up to two million workers. A minimum wage set at £5 or less – as the business lobby is suggesting – would mean that the value of the wage would fall against average earnings, which are expected to rise by 9 per cent over the next two years.
The TUC is also recommending that the adult minimum wage be paid from the age of 18 rather than at 22. The submission proposes an increase that would sustain the level of the £3 minimum wage for 16- and 17-year-olds in 2005 in relation to earnings, and says that for 2006 it would like to see an interim review to set a rate that benefits larger numbers of young workers.
Brendan Barber, TUC general secretary, said: “This increase would be fair and affordable. We have looked at the hard evidence and worked with our partners on the Low Pay Commission to ensure that the wage is set at the right level to benefit business and the target number of low-paid employees.
“There is no economic argument against continuing to increase the minimum wage above inflation and the growth in earnings. But there is a very strong case for ensuring that up to two million low paid workers get a pay rise over the next two years, not a pay cut.”
Brendan Barber will be speaking at Personnel Today’s HR Directors Club on 16 November. For more details visit www.hrdirectorsclub.com