TUC: Young Workers Could Miss Out On £2,400 A Year Due To “Unfair” Minimum Wage Rules
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The TUC has published new analysis which reveals more than 700,000 workers aged 18-20 across the UK risk being left “hugely out of pocket” due to being paid a lower rate of the minimum wage. This means that as many as seven in ten workers aged 18-20 could lose out.
The minimum wage pay penalty facing workers aged 18-20 this coming year is an estimated £2,438 a year (for those who work 52 weeks a year), or £47 a week.
The analysis comes ahead of the TUC’s Young Workers Conference this weekend, which focuses on issues facing young workers.
Tiered rates must be “overhauled”
The TUC says that paying a lower rate to younger adults is “unfair” and that the tiered rates system must be “overhauled”.
Young workers are paid a lower minimum wage. The main minimum wage rate is currently £10.42 per hour for those 23 and over. However, it is £10.18 for 21-22 year olds, £7.49 for 18-20 year olds and £5.28 for under 18s.
From April, the minimum wage rises to £11.44 and will be extended to those aged 21 and 22 after the government accepted recommendations from the Low Pay Commission.
However, minimum wage workers aged 18-20 could be paid almost £3 less an hour than those aged 21 and over, with the minimum wage for workers in that age bracket rising to just £8.60.
The Low Pay Commission has also previously stated that the gap between youth rates and adult rates has widened and has said that there is a consensus on the commission that this should be addressed.
Labour’s New Deal
If it is elected into power, Labour has pledged to make sure the minimum wage is a real living wage that people can live on, removing discriminatory age bands to ensure every adult worker benefits - as well as banning zero hours contracts which disproportionately impact young workers.
The TUC says a Labour government would “transform” the lives of young workers with its New Deal for Working People.