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Younger person minimum wage not proposed

25 May 2012

The Minister for Social Security has accepted the Employment Forum’s recommendation that that a lower minimum wage rate for young people should not be introduced.

Due to increasing unemployment, particularly amongst young people, the Social Security Minister had directed the Employment Forum to review the impact of introducing a youth rate.

Helen Ruelle, Chairman of the Employment Forum explained, “The forum has previously considered whether a lower rate for young people should be introduced and we appreciated that this could potentially bring opportunities for employers and employees. We were mindful, however, that evidence would have to demonstrate that a youth rate would be likely to have a positive impact on youth unemployment, taking into account the employment market as a whole.

Having considered the outcomes of independent research, the forum unanimously concluded that a youth rate would not provide a quick fix to youth unemployment and we recommended that the law should not be amended to introduce a youth rate.”

The Minister for Social Security, Senator Francis Le Gresley, has accepted the forum’s recommendation, commenting “I had hoped that a youth rate might encourage employers to employ more young people and give young people a ‘foot in the door’.  I have, however agreed not to propose a youth rate at this time. We will need to monitor the success of our other initiatives to help people of all ages into work.

This research has revealed that training is very important to the young people and employees who were surveyed. I have asked the forum to review the trainee rate and the criteria that permit employers to pay the lower rate during this year.”

The forum will consult on the minimum wage and the trainee rate during June to September 2012. Any person who wishes to be notified about that consultation should contact the Secretary to the forum by telephoning 447203 or by email, contact details to the right of this page.

The forum’s recommendation, which includes a report on the independent research undertaken by Island Analysis, is available on the 'Minimum wage' page. Copies can also be obtained from the secretary to the forum (contact details to the right of this page).

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