Increase in national minimum wage

Employers will welcome the fact that the Government has announced modest increases in the national minimum wage (NMW) from 1 October 2009.

The adult rate (for workers aged 22 and over) rises by 7p an hour from £5.73 to £5.80; the development rate for 18- to 21-year-olds is increased by 6p from £4.77 to £4.83 an hour; and the rate for 16- to 17-year-olds is increased by 4p from £3.53 to £3.57 an hour.

The rate for the accommodation offset is increased to £31.57 per week (£4.51 per day).

Also from 1 October, employers will no longer be able to include tips to make up the balance of the minimum wage. Currently, firms can use service charges and gratuities processed through the payroll as part of staff wages.

In addition, from October 2010, the adult statutory minimum rate will apply to 21-year-olds, who are currently entitled to the same minimum rate as 18- to 20-year-olds.

• See guidance on NMW on the Department for Business, Enterprise and Regulatory Reform website