Consultation outcome

Low Pay Commission consultation questions

Updated 5 March 2024

Consultation questions

About you

1 - Please provide information about yourself or your organisation. If possible, include details about your location, the type of job or business (occupation and/or sector) you are involved in, your workforce if you are an employer (including number of minimum wage workers), and anything else you think is relevant.

The National Living Wage

2 - What has been the impact of the National Living Wage (NLW) in the past year, including the rise to £10.42? Our critical interest is in its effects on employment, hours and earnings. We are also interested in the effect of the NLW on any of the areas listed below:

• a. Profits

• b. Prices

• c. Productivity

• d. Pay structures and differentials

• e. Progression and job moves

• f. Training

• g. Investment

• h. Recruitment

• i. Job quality and security

3 - To what extent has the NLW affected different groups of workers, particularly those with protected characteristics (for example women, ethnic minorities and those with disabilities) and migrant workers?

4 - How has the NLW’s impact varied across different areas of the UK?

5 - At what level should the NLW be set from April 2024? Our current central projection for the on-course rate is £11.16 within a range of £10.90 and £11.43.

Experience of low-paid workers

6 - What has happened to quality of work recently? For example, have workers experienced changes in contract types, flexibility, workplace harassment and work intensification (e.g. greater expectations for workers to work more flexibly, with greater effort, to a higher standard etc).

7 - What has been workers’ experience of the wider benefits available to workers (including premium pay and non-pay benefits across the workforce)?

8 - What are the barriers preventing workers from moving to a new job, particularly one that is better paid?

9 - What are workers’ views on the recruitment difficulties reported by many employers since the pandemic? Why have employers found it difficult to recruit?

10 - How has access and cost of childcare and transport affected workers’ ability to move into work or to a better paying job?

11 - What opportunities are there for progression to better-paid work for low-paid workers and how common is promotion?

12 - What has been workers’ experience of the Universal Credit system and how the minimum wage interacts with it? Has this influenced workers approach to how many hours they work?

13 - How has the rising cost of living affected workers on or close to the NMW and NLW and how, if at all, has this affected worker needs and expectations from their employment and pay?

Young people

14 - What has been the effect of changes in the minimum wages for young people on their employment prospects?

15 - How do the youth minimum wage rates influence employers’ decisions about hiring and young people’s decisions about employment?

16 - What other factors determine pay for young people aside from the rates? For example, job role or length of time in the job?

17 - Why do employers make use of the youth rates? To what extent has this been affected by the recent tight labour market (difficulties in recruiting)?

18 - To meet the Government’s 2024 target the NLW age threshold would be lowered to 21 in 2024. What impacts do you think this would have, including on employment?

19 - At what level should these rates be set from April 2024?

Minimum wages after 2024

Since 2020, our remit for the NLW has been to recommend a rate consistent with reaching the target of two-thirds of median hourly earnings by 2024. We are now gathering evidence to inform the Government’s decisions on policy options for the future beyond 2024. We are seeking evidence and views on:

20 - The purpose of the NMW and NLW.

21 - The role of the Low Pay Commission.

22 - The range of policy options and how these might work (for example, a further target; or an approach not driven by targets).

23 - The potential effects of further minimum wage increases and risks we should consider.

24 - The levels and existence of different age-related minimum wages.

25 - The evidence that should inform future policy decisions.

Apprentices

26 - What is the outlook for the recruitment and employment of apprentices?

27 - How widely used is the Apprentice Rate? What kind of apprenticeships are paid this rate? What kind of jobs do these apprenticeships (paid at the Apprentice Rate) lead to?

28 - The Apprentice Rate increases this year to £5.28, the same level as the 16-17 Year Old Rate. What do you expect the effects of this increase to be?

29 - What criteria should we use when considering whether to keep or remove the Apprentice Rate?

30 - What would be the effect of removing the Apprentice Rate (so that minimum wages for all apprentices were the same as for other workers the same age)?

Compliance and enforcement

31 - What issues are there with compliance with the minimum wage and what could be done to address these?

32 - What comments do you have on HMRC’s enforcement work?

Accommodation Offset

33 - What has been the effect of recent increases in the offset on employers’ decisions over providing accommodation?

34 - What impact does the offset have on workers? What are the hours, pay and working conditions of workers for whom the offset is deducted?

35 - Last year we recommended that a quality standard and suitable enforcement regime are put into place as soon as possible. This would need to be implemented before we could recommend further significant changes to the offset. What would the impact of this policy be for employers and how would it affect the accommodation they provide?

36 - We also recommended a minimum hours requirement before accommodation costs can be deducted. If implemented what would the effect of this policy be and what should be considered when setting a minimum hours requirement?

Economic outlook

37 - What are your views on the economic outlook and business conditions in the UK for the period up to April 2024? We are particularly interested in: - the conditions in the specific sector(s) in which you operate. - the effects of Government interventions to support the economy and labour market. - the current state of the labour market, recruitment and retention.

38 - To what extent have employers been affected by other major trends in the economy and labour market: for example, inflation, Brexit, the shift to homeworking or changes in the numbers of migrant workers in the UK?

39 - Apart from the minimum wage, what are the key drivers of pay decisions in low-paying sectors and occupations? For example, this could include the cost of living, availability and retention of staff, changes to Universal Credit/other benefits or access to transport.

40 - How has inflation and the cost of living factored into wage setting? What has been your experience of wage growth and inflation in the last year, and what are your views on forecasts for the next couple of years?