National Minimum Wage Act 1998
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| Long title | An Act to make provision for and in connection with a national minimum wage; to provide for the amendment of certain enactments relating to the remuneration of persons employed in agriculture; and for connected purposes. |
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| Citation | 1998 |
| Territorial extent | England and Wales; Scotland; Northern Ireland |
| Dates | |
| Royal assent | 1998 |
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Status: Current legislation
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| Text of statute as originally enacted | |
| Revised text of statute as amended | |
The National Minimum Wage Act 1998 creates a minimum wage across the United Kingdom, currently £7.20 per hour for workers aged over 25, £6.95 per hour for workers aged 21 to 24 and £5.55 per hour for workers aged 18 to 20. It was a flagship policy of the Labour Party in the UK during its 1997 election campaign and is still pronounced today in Labour Party circulars as an outstanding gain for ‘at least 1.5 million people’. The national minimum wage (NMW) took effect on 1 April 1999. On 1 April 2016 an amendment to the act created an obligatory National Living Wage for workers over 25, which was implemented at a significantly higher minimum wage rate of £7.20, and is expected to rise to at least £9 per hour by 2020.
No national minimum wage existed prior to 1998, although there were a variety of systems of wage controls focused on specific industries under the Trade Boards Act 1909. The Wages Councils Act 1945 and subsequent acts applied sectoral minimum wages. These were gradually dismantled, until the Trade Union Reform and Employment Rights Act 1993 abolished the 26 final wages councils that had protected around 2.5 million low paid workers.
Part of the reason for Labour's minimum wage policy was the decline of trade union membership over recent decades (weakening employees' bargaining power), as well as a recognition that the employees most vulnerable to low pay (especially in service industries) were rarely unionised in the first place. Labour had returned to government in 1997 after 18 years in opposition, and a minimum wage had been a party policy as long ago as 1986 under the leadership of Neil Kinnock.
The implementation of a minimum wage was opposed by the Conservative Party and supported by the Liberal Democrats.
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