ESS limits minimum wage rise

A RISE in line with inflation has been proposed for the minimum wage as Employment & Social Security slows down its planned increases in reaction to Covid-19.

Outgoing ESS president Deputy Michelle Le Clerc, who did not stand for re-election to the States, said that her committee was in power until 15 October and was keen to get minimum wage proposals out to make employers aware of the proposed new rates. (Picture by Peter Frankland, 28783281)

The committee has proposed that the rate go up by 20p from January to £8.70 an hour.

This will still be less than the UK’s, which is already £8.72 for those aged over 25.

Guernsey’s young person’s rate, which applies to 16- and 17-year-olds, will increase from £8.05 to £8.25 per hour if the proposal is accepted by the States.

The increases are in line with RPIX of 2.4%.

Employment & Social Security president Michelle Le Clerc said: ‘Covid-19 has had a significant impact on the economy and on the viability of the hospitality and accommodation sectors, where wages are generally low.

‘We have listened to the consultation feedback from employers in those sectors.

‘We think it is sensible to increase rates by no more than RPIX for next year to allow businesses a little more time to recover.

‘At the same time, the committee believes the minimum wage should at least keep pace with inflation so that the gap between the lowest paid and the middle earners does not widen.’

In November 2018, ESS had States agreement to increase the rates by more, in equal annual increments over the course of five years, until they reach 60% of median earnings by 2023. But it has now pushed this back a year.

Continuing with that formula would have increased the minimum wage rate by 5.9%.

‘It may seem a bit strange for an outgoing committee to be publishing these proposals immediately after a general election,’ she said.

‘But the current committee has its full powers until 15 October and we want to get these proposals out in the public domain as early as possible so that employers are aware of the new rates.

‘`We expect the new Assembly to debate these proposals at the end of November.’

The offset where accommodation is provided by an employer will increase from £82 to £84 per week.

And where both accommodation and food are provided, this will increase from £114 to £117.

These changes would also take effect from 1 January.