Page last updated at 09:22 GMT, Wednesday, 1 October 2008 10:22 UK

Minimum wage rise is now in force

The national minimum wage became law a decade ago

An increase in the national minimum wage from 5.52 to 5.73 an hour for adult workers has come into force.

The statutory hourly rate for 18 to 22-year-olds has also risen from 4.60 to 4.77, and for 16 and 17-year-olds has lifted from 3.40 to 3.53.

The rise comes with a warning from the government that it is proposing stricter penalties for bosses who fail to pay.

Unions have called for a bigger rise with food and utility bills going up.

Wage boost

Prime Minister Gordon Brown announced in March that the minimum wage would increase.

The rise comes shortly after the 10-year anniversary of the introduction of the minimum wage, which was first set at 3.60 an hour.

"The minimum wage has made a lasting and significant difference to the low paid, with around a million workers benefiting from the increase each year," said Employment Relations Minister Pat McFadden.

"It is vital that we safeguard this right with effective enforcement, which is why we're bringing in tough new penalties for those who flout the law."

New rules

The government is planning to introduce new regulations in April that will impose a 5,000 automatic fine on any employer failing to pay the minimum rate.

Serious cases could lead to a prosecution in a Crown Court where there is no limit to the fine that could be set.

A helpline was recently set up for people to report the mistreatment of workers and illegal pay rates.

"With rogue employers constantly seeking new ways to evade paying the minimum wage, the government must be vigilant in enforcing it," said Dave Prentis, general secretary of public sector union Unison.

"The rise to 5.73 is a welcome cushion, however, with the price of everyday essentials such as food, gas and electricity going up massively, it won't lift enough working people out of the poverty trap.

"A more realistic figure would be 6.75 an hour - a fair day's pay for a fair day's work, regardless of age."

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