Labour's plan for single adult minimum wage could take years

Plans to remove different age bands on the National Minimum Wage could take several years to come into force, according to new government guidance.

Labour has pledged to scrap the “discriminatory” age bands on minimum pay to create a single adult rate.

Currently, 18-to-20-year-olds must be paid a minimum of £8.60 per hour, compared to the National Living Wage of £11.44 for those aged 21 and over.

But rather than creating an overall adult rate from April 2025, the government has asked the Low Pay Commission (LPC) to recommend a new minimum rate for 18-20-year-olds.

“This should continue to narrow the gap with the National Living Wage, taking steps year by year in order to achieve a single adults rate,” a government document states.

What is Labour’s plan for the minimum wage?

The LPC has been asked to consider the impact of higher minimum pay on business, competitiveness, the labour market, the wider economy and the cost of living.

It has also been asked to look at the levels of pay for under 18s and apprentices so their rates are “set as high as possible without damaging the employment prospects of each group”.

Labour has promised a major overhaul of workers’ rights within its first 100 days in office.

However, it faced backlash from the hospitality industry after the King’s Speech made no mention of promised reform to the creaking business rates system.

Operators have criticised previous governments for requiring them to pay higher wages without measures to offset other taxes such as business rates of VAT.

When the National Living Wage rose almost 10% in April this year, hospitality business owners told The Caterer they had been forced to raise prices and, in some cases, add a 10% service charge to bills to absorb the cost.

Chancellor Rachel Reeves said this week there will be “difficult decisions” to come at the next Budget on 30 October in a bid to fill a £22b black hole in public finances.

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