THOUSANDS of young workers could be in line for a pay rise of more than 8% at the Autumn Budget.
The Low Pay Commission, which advises the government on changes to the minimum wage, has told Rachel Reeves people on minimum youth wages should receive a pay rise that is twice the rate of older workers on the national living wage.
That is according to a report in the Financial Times, with the outlet citing sources familiar to the matter.
As it stands, young workers aged under 18 are entitled to a minimum wage of at least £7.55 per hour.
This rises to £10 per hour for those aged between 18 and 20 years old.
Anyone aged 21 or over is entitled to a wage of £12.21 per hour.
The outlet said Reeves will use her Budget next week to confirm the minimum wage for those aged over 21 will rise by around 4.1% to £12.71 next April.
This is in line with recommendations from the Low Pay Commission.
But the commission has also recommended an increase of more than 8% to the current £10 an hour for workers aged 18-20.
Reports by the outlet have said Reeves may be nervous to approve the rate after hikes to minimum wage last year sparked backlash from sectors in the UK such as hospitality.
However, government figures cautioned that she may have “little choice” after Labour’s manifesto promised to move towards a single minimum wage for all working adults.
It previously said it was “discriminatory” to have different minimum pay rates for adults of different ages.
In her budget last year, Reeves confirmed that the minimum wage for 18- to 20-year-olds would rise from £8.60 to £10 per hour – a 16.3% boost.
It has been estimated that 88,000 people were on the youth minimum wage last year.
Young workers could see more pay hikes in the future, with the government aiming to close the gap with over-21s by April 2029.
This is to help meet a commitment Labour made in its election manifesto.
The Sun has approached The Treasury and LPC for comment.
The news comes as many employers are still struggling with wage increases, alongside higher National Insurance contributions (NICs).
Kate Nicholls, head of the trade body UKHospitality, previously warned: “Businesses are already struggling to absorb all the costs from last year, two successive years of significant minimum wage rises and crucially NICs.
“We have seen 100,000 jobs lost as a direct result of that. If you want fair pay, you have got to have sustainable businesses.
Supermarket bosses have also warned the move could lead to higher prices at the till.
Sainsbury’s boss Simon Roberts said supermarkets already work with tiny profit margins and extra costs have to go somewhere.
However, many unions have said the move would be good for workers and the economy.
The government has pledged to provide a “genuine” living wage for workers and says it wants to factor the cost of living crisis into decision-making on wages for the country’s lowest-paid workers.
Who gets the National Minimum Wage and am I entitled?
TO qualify for the National Minimum Wage, you have to be of school-leaving age, which is usually above 16.
You are eligible to receive the pay rate if you work full-time, part-time or as a casual labourer.
You are also entitled to the National Minimum Wage if you are an agency worker.
Apprentices also qualify for a National Minimum Wage, as well as trainees and staff still in their probationary period.
The rates also apply to disabled workers.
Those who are self-employed, voluntary workers, company directors, and family members who live in the home of the employer and do household chores do not qualify for the minimum wage.
Au pairs, members of the armed forces, and people on a government employment programme are also not entitled to the payment.
