TOEFL Ibt -Reading 2

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1. The national minimum wage (NMW) sets minimum hourly rates that employers must pay their workers. It covers almost all workers in the UK. There are three aged based rates and an apprentice rate.

2. Almost all employees who work in the UK are entitled to the national minimum wage. However, some professional categories are not, including self-employed people and children who are still of compulsory school age.

3. It makes no difference to the national minimum wage whether the workers work for you full-time or part-time, or whether they are an agency worker, a temporary or casual worker, a piece worker, or a home worker. The minimum wage was put into place after The National Minimum Wage Act of 1998. This act created a minimum wage across the United Kingdom, currently £6.08 per hour for workers aged 21 years and older, and £4.98 per hour for workers aged 18–20. It was a flagship policy of the Labour Party in the UK during its 1997 election campaign and is still pronounced today in Labour Party circulars as an outstanding gain for “at least 1.5 million people.” The national minimum wage (NMW) took effect on April 1, 1999.

4. No national minimum wage existed prior to 1998, although there were a variety of systems of wage controls focused on specific industries under the Trade Boards Act of 1909. Part of the reason for the Labour Party’s minimum wage policy was the decline of trade union membership over recent decades (weakening employees’ bargaining power), as well as a recognition that the employees most vulnerable to low pay (especially in service industries) were rarely unionized in the first place. The Labour Party had returned to government in 1997 after 18 years in opposition, and a minimum wage had been a party policy as long ago as 1986 under the leadership of Neil Kinnock. The implementation of a wage was opposed by the opposition Conservative Party and Liberal Democrats.

5. The NMW is enforceable by a contractual claim or through Section 13 of the Employment Rights Act of 1996 or if the exploited worker demands to see his employer’s records and is refused. Section 18 provides for compensation to the order of 80 times the minimum wage. Employers must not subject their workers to dismissal or any other detriment (Section 25 and Section 23). Nevertheless, employees may not wish to take the risk while employed. (Some employees might not enforce their rights even if dismissed, such as illegal immigrants, who face being sent home if they claim.) Administrative enforcement by inspectors provides more help. Inspectors may order compliance and payment. This may be appealed by the employer, but ongoing failure to

comply entails cumulative penalties. However, the effectiveness of inspection is limited by the resources given to inspect.

6. The policy was opposed by the Conservative Party at the time of implementation, who argued that it would create extra costs for businesses and would cause unemployment. The Conservative Party’s leader from 2005 to 2016. David Cameron, said at the time that the minimum wage “would send unemployment straight back up.” However, in 2005 Cameron stated that “I think the minimum wage has been a success, yes. It turned out much better than many people expected, including the CBI.” It is now Conservative Party policy to support the minimum wage. Boris Johnson, the Mayor of London at the time, a Conservative, has supported the London Living Wage since coming to office, ensuring that all city hall employees and subcontracted workers earn at least £7.60 an hour and promoting the wage to employers across the city. In May 2009 his Greater London Authority Economics unit raised the London Living Wage for City Hall employees to its current rate of £7.60, £1.80 more than the then minimum wage of £5.80.

7. [1] To put the pay in an annual perspective, an adult over the age of 22 working at minimum wage for 7.5 hours a day, 5 days a week, will make £942.50/month and £11,310/year gross income. [2] After tax this becomes £810.63/month or £9,727.55/year. [3] Full-time workers are also entitled to a minimum of 5.6 weeks paid holiday per year from April 1, 2009, with pro-rata equivalent for part-time workers. [4] To this day, the minimum wage has increased significantly since it was put into place. The only question is, how far can it rise before causing problems to company owners?