Guernsey: Minimum Wage – Public consultation on the level of minimum pay ratesWednesday, July 15th, 2009
The Commerce and Employment Department (CED) has launched a public consultation to obtain the views of employees, workers, employers and members of the public on the level at which minimum wage rates might be set.
Unlike the UK, the Isle of Man and Jersey, Guernsey does not yet have a statutory minimum wage. The legislation required to introduce a minimum wage, the Minimum Wage (Guernsey) Law, 2009 is currently with the Privy Council awaiting Royal Assent. It is anticipated that, subject to Privy Council approval, the Law will be laid before the States for enactment during the last quarter of 2009, or early in 2010. The Commerce and Employment Department is required to issue Regulations that will set the minimum wage rates.
The States has already decided by Resolution that there will be two rates, namely for employees and workers
- aged 19 and over – the Adult Rate, and
- between statutory school leaving age (16) and up to, and including, age 18 – the Young Persons Rate.
In setting and, in future, amending the minimum wage rates, the CED is required to take into account:
- the current rate of the minimum wage in the United Kingdom, the Isle of Man and Jersey,
- the current economic and trading conditions prevailing in Guernsey,
- the rate of inflation in Guernsey,
- the rate of unemployment in Guernsey,
- current rates of pay in Guernsey,
- the increase or decrease in rates of pay in Guernsey over the previous 12 months, and
- any other factors that appear to be relevant.”
Before issuing Regulations, the CED is required to consult on the minimum wage rate and on the pay reference period that will be used to calculate whether or not the minimum wage has been paid. The “wage” in this context is the gross hourly rate of pay, before deduction of income tax and Social Insurance contributions. Compliance will be measured by dividing the gross pay in the pay reference period, e.g. a week or a month, by the number of hours worked in the period.
The Regulations will define the pay elements that will count towards the minimum wage pay. It will include, for example, basic salary or pay, incentive payments and commission, bonuses, and tips or gratuities paid through payroll, but not payments made under a loan agreement, an advance of wages, a pension payment, a lump sum on retirement, a reward under a staff suggestion scheme etc., or re-imbursement of expenses.
The Regulations will also make provision for an accommodation offset and a food offset, in order to discourage employers from recouping the minimum wage paid to a worker by levying an excessive charge for the provision of accommodation or food.
The Department has produced three slightly different Questionnaires, which are tailored to the particular interest groups, namely employers, employees and workers, and others. In particular, the CED is interested to hear from parties in the traditionally lower paid industries, including agriculture, horticulture, care homes, laundries, cleaning, and hospitality (hotel, restaurants, bars and clubs).
The completed questionnaire should be returned to the offices of the CED by Friday 28th of August 2009.
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