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Minimum Wage Regulations: Proposed Amendments

A formal published “Ministerial Decision” is required as a record of the decision of a Minister (or an Assistant Minister where they have delegated authority) as they exercise their responsibilities and powers.

Ministers are elected by the States Assembly and have legal responsibilities and powers as “corporation sole” under the States of Jersey Law 2005 by virtue of their office and in their areas of responsibility, including entering into agreements, and under any legislation conferring on them powers.

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A decision made on 12 November 2010 regarding proposed amendments to Minimum Wage Regulations

Decision Reference: MD-S-2010-0071

Decision Summary Title :

DS - 2011 MW Regs

Date of Decision Summary:

9 November 2010

Decision Summary Author:

Policy Principal

Decision Summary:

Public or Exempt?

Public

Type of Report:

Oral or Written?

Written

Person Giving

Oral Report:

N/A

Written Report

Title :

Accompanying report for the Employment (Minimum Wage) (Amendment No. 7) (Jersey) Regulations 201-

Date of Written Report:

9 November 2010

Written Report Author:

Policy Principal

Written Report :

Public or Exempt?

 

Public

Subject: Employment (Minimum Wage) (Amendment No. 7) (Jersey) Regulations 201-

Decision(s): The Minister decided to lodge ‘au Greffe’ the Draft Employment (Minimum Wage) (Amendment No. 7) (Jersey) Regulations 201- which would increase the maximum amounts that may be offset against the minimum wage for accommodation and food, effective from 1 April 2011.

Reason(s) for Decision: The Minister had approved the Employment Forum’s recommendation that the maximum amount that an employer may offset against the minimum wage where living accommodation is provided to an employee should be increased to £69.21 per week, or £92.27 per week where both food and living accommodation are provided.  The Minister had also approved the Forum’s recommendation that employers should be prevented from using tips, service charges, gratuities and cover charges received from customers towards minimum wage pay.

 

The Minister intends that the minimum wage will be increased to £6.32 and the trainee rate will be increased to £4.74 by Ministerial Order, subject to the States adopting the proposed amendment to the Regulations.

Resource Implications: There are no financial or manpower implications.

Action required: Policy Principal to request the Greffier of the States to arrange for the Projet to be lodged ‘au Greffe’ for States debate on 18 January 2011.

Signature:

 

 

Position:

Minister

 

Date Signed:

 

 

Date of Decision (If different from Date Signed):

 

Hide report
Minimum Wage Regulations: Proposed Amendments

 

Accompanying report for the Employment (Minimum Wage) (Amendment No. 7) (Jersey) Regulations 201-

 

Introduction

 

Jersey’s minimum wage has been in force since 1 July 2005.  On the basis of the Employment Forum’s latest recommendation, the Social Security Minister proposes this amendment to the Minimum Wage Regulations that would increase the amounts that may be offset against the minimum wage where food and living accommodation are provided, as well as preventing employers from using tips, service charges, gratuities and cover charges towards minimum wage pay.

 

Subject to the States approval of this draft amendment, the minimum wage and trainee rate would be increased by Ministerial Order, to be effective from 1 April 2011.

 

Background

 

The independent consultation body, the Employment Forum presented its recommendation to the Minister on 27 September 2010, which is attached at Appendix 1.  The Minister accepted the Forum’s recommendations on 5 October 2010.  In summary, the Forum recommended the following increases:

 

 

1 April 2010

1 April 2011

Minimum Wage

£6.20

£6.32

Trainee Rate

£4.65

£4.74

Accommodation offset

£67.85

£69.21

Accommodation & food offset

£90.46 

£92.27

 

Tips

 

The Forum had recommended to the Social Security Minister in 2009 that the Regulations should be amended, as in the UK, to prevent employers from using amounts received from customers by way of tips, service charges, gratuities and cover charges towards payment of the minimum wage. The legislation currently allows employer to count such amounts towards minimum wage pay where they are paid through the payroll.  The Minister agreed that Regulation 8 should be amended to prevent this practice from 1 April 2011.

 

Offsets

 

Regulations may be made under Part 4 of the Employment (Jersey) Law 2003 specifying permissible offsets against the minimum wage, requiring that all employees in Jersey are paid at an hourly rate which is equal to or greater than the minimum wage.  The Regulations ensure that the ability to offset benefits in kind against weekly wages is limited only to charges made by the employer for living accommodation, or living accommodation with food.

 

This proposed amendment to the Regulations would increase the maximum value that may be attributed to the two benefits in kind, effective from 1 April 2011, for the purpose of establishing whether the minimum wage has been paid:

 

  • For the provision of accommodation to the employee, the maximum weekly offset against the minimum wage would be £69.21.

 

  • For the provision of both accommodation and food to the employee, the maximum weekly offset against the minimum wage would be £92.27.

 

 

Minimum wage rates

 

Subject to the States approval of the proposed Regulations, the Social Security Minister proposes that an Order would be made under Article 16(3) of the Employment (Jersey) Law, 2003, to apply the following rates from 1 April 2011;

 

  • An hourly minimum wage of £6.32, to apply to all employees over school leaving age, except when the trainee rate is paid, and ‘special classes of person’, which includes share fishermen, residential members of religious communities, and others as detailed in articles 36 to 43 of the Employment Law.

 

  • An hourly trainee rate of £4.74 which may be paid to an employee over school leaving age, who is undertaking an accredited course of training for a maximum period of one year, when in a new job, with a new employer, by written agreement. 

 

 

There are no financial or manpower implications arising from this proposition.

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