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Employers to be named on minimum wage breaches

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Firms that flout the rules on the national minimum wage will be publicly named, the government has announced.

As from 1 January 2011, employers who break the law on basic pay will find their names published on the Department for Business website and given three months in which to correct the breach.

Detailing the new penalty, Edward Davey, the Employment Relations Minister, said: “Bad publicity can be a powerful weapon in the fight against employers who try to cheat their workers and their competitors. Their reputation can be badly damaged if they are seen to be flouting the law.

“Responsible employers should also make themselves aware of the new rates that have come into effect from 1 October. The increases to the national minimum wage this year are appropriate for the economic climate. They will strike a balance between helping the lowest paid whilst at the same time not jeopardising their employment.”

As from 1 October, employees will no longer have to be aged 22 to become eligible for the top hourly minimum wage adult rate.

The new rates are: £5.93 per hour for low paid workers aged 21 and over, up from £5.80; £4.92 per hour for 18-20 year olds, up from £4.83; and £3.64 per hour for 16-17 year olds, up from £3.57.

For the first time there is an apprentice minimum wage of £2.50 per hour. The new rate applies to those apprentices who are under 19 or those that are aged 19 and over but in the first year of their apprenticeship.

The accommodation offset rises from £4.51 per day to £4.61.

Regulations cracking down on rogue operators in the modelling and entertainment sector – banning up-front fees for aspiring models and significantly tightening the conditions attached to them elsewhere – also came into force on 1 October.

The British Retail Consortium (BRC), however, warned on the size of future increases in the minimum wage.

While backing the principle of the minimum wage, the BRC argued that any increase above 1.7 per cent, which is the average rate of earnings increases over the last 12 months, would seriously impede the ability of firms to maintain and create jobs.

Stephen Robertson, the BRC’s director general, commented: “There’s a delicate compromise between higher wages and more jobs. But the best protection for wages is preserving jobs to keep people working.

“Anything up to a 1.7 per cent increase in next year’s minimum wage strikes a sensible balance between helping low-paid workers and enabling businesses to create and maintain jobs. It’s the private sector that will drive the economic growth that will provide the jobs and tax revenues of the future.

“But trading conditions are tough. Higher costs, such as next April’s National Insurance increase, will pile on even more pressure. Even a small increase in 2011’s minimum wage could choke off vital potential to create new jobs.”