NMWM01020 - History of National Minimum Wage and overview of legislation: history of the National Minimum Wage
Relevant legislation
The legislation that applies to this page is as follows:
- National Minimum Wage Act 1998
General
Some form of wage control has been in existence since the Fair Wages Resolution of 1891. This required employers engaged on government contracts to pay their workers a recognised minimum for the employment sector concerned.
Minimum Wage laws were first introduced to Britain in December 1909 and led to the establishment of Trade Boards. In 1945 these were converted into Wages Councils that regulated pay in certain industries. The Wages Councils system reached its peak in 1953, when there were 66 Councils covering 3.5 million workers. By the time of their abolition in 1993, the number of Councils had fallen to 26, covering about 2.6 million workers. After abolition employers were given more freedom to decide how much to pay their employees. Only the Agricultural Wages Board (NMWM02050), and the Scottish and Northern Irish equivalents remained.
The National Minimum Wage Bill was introduced before Parliament on 26 November 1997. The National Minimum Wage Act 1998 (NMWM01030) received Royal Assent on 31 July 1998. This was the first time legislation had been introduced in the United Kingdom which ensured a minimum level of pay for virtually all workers. The Act amended legislation relating to agricultural workers to ensure that they are also paid at least National Minimum Wage rates. It also provided a statutory framework for the Low Pay Commission (NMWM02010) which was set up in 1997 and which makes recommendations on minimum wage rates and other aspects of the minimum wage regime.
There is no European Union requirement for the United Kingdom to introduce a National Minimum Wage, as arrangements for setting pay are a matter for individual member states. However, many countries, including other European countries and the United States of America have their own National Minimum Wage legislation.