Minimum Wage And Holiday Increase

More than a million workers will see their pay rise from today, as this year's minimum wage increase comes into force.In addition up to six million workers will also benefit from an increase in the amount of annual paid leave that UK staff are legally entitled to, the government has said.

The adult rate for the statutory minimum wage will go up from £5.35 to £5.52 and from £4.44 to £4.60 for 18-21-year-olds.The rate for 16 and 17-year-olds will increase from £3.30 to £3.40 an hour.Meanwhile, annual leave entitlement will increase from 20 to 24 days a year for full-time workers and will increase again to 28 days from April 2009.

Employment relations minister Pat McFadden claimed that businesses would benefit from a more motivated and productive workforce as a result of the changes.
"These changes will improve the lives of millions of British workers, giving them more time with their families and ensuring our lowest paid workers continue to be able to earn a living wage,"

The Trades Union Congress (TUC) also welcomed the minimum wage increase as a "much-needed boost to the pay packets of millions of low paid workers".

However new research published today by the British Retail Consortium (BRC) claims that last year's minimum wage increase cost retailers £1.7 billion, 13 per cent more than expected.

In addition to financing the higher rates of basic pay, the BRC says that some £200 million of the total cost was due to retailers having to find extra money to maintain pay differentials among staff as a result of the rise.BRC director general Kevin Hawkins said: "Past minimum wage increases have appeared to emerge from an attempt to balance competing bids from business and unions rather than being genuinely based on economics.