Queen's Speech 2017: National Living Wage and Workers' Rights

“The National Living Wage will be increased so that people who are on the lowest pay benefit from the same improvements in earnings as higher paid workers. My Ministers will seek to enhance rights and protections in the modern workplace.”

• There are currently 31.95 million people in work - 372,000 more than this time last year.
• The employment rate is at 74.8% - its joint highest rate since records began back in 1971.
• While record numbers of people are in employment, there have been reports of some employers not treating their staff in a way that we would expect.
• We are committed to building an economy that works for everyone and we are clear that employers must take their employment law responsibilities seriously.
• This means making sure workers are paid properly and enjoy the rights to which they are legally entitled.
• The Government introduced the new National Living Wage in April 2016 to provide a significant boost to the earnings of the lowest paid, whilst recognising that this needs to be affordable for businesses.
• Hence the National Living Wage will be increased to 60% of median earnings by 2020, meaning that the wages of the lowest paid will increase faster than average in order to get there.
• And after 2020, the National Living Wage will continue to be increased so that these workers will benefit from the same improvements in earnings as the average worker.
• We want to make sure employment rules and rights keep up to date to reflect new ways of working, and that is why in October we asked Matthew Taylor to conduct an independent review into modern employment practices.
• We recognise the importance of being open to new and innovative ways of working - and having a skilled and flexible workforce is part of what makes the UK an attractive place to do business.
• But it is also crucial that workers receive a decent wage and that people working in all sorts of jobs are able to benefit from the right balance of flexibility, rights and protections.
• The Matthew Taylor Review of Employment Practices is an important step towards us ensuring fairness for everyone in work and we look forward to receiving the report shortly.

Key facts

• Over 2 million workers were estimated to be covered by the National Minimum and National Living Wage in April 2017 - around 9% of all employees.
• The introduction of the National Living Wage benefitted over 1.5 million employees in April 2016 and contributed towards the lowest earners’ fastest pay rise in 20 years. The 4.2% increase in the National Living Wage to £7.50 in April 2017 was estimated to benefit up to 2 million workers. It means an increase in earnings of over £500 a year for a full-time worker on the National Living Wage rate.
• Since April 2016, the National Living Wage has added £1,400 to the annual income of those in full-time work on minimum wage.
• Between 2015 and 2016, earnings for those on the lowest pay grew more than twice as fast as those on the highest pay (6.2% growth at the fifth percentile, and 2.5% growth at the 95^thpercentile). The Office for National Statistics highlighted the probable role of the National Living Wage in driving this growth, and note that the growth at the fifth percentile-is the highest it has been since the data series began in 1997.
• The Matthew Taylor Review of Modern Employment Practices was commissioned in October 2016 to help us understand whether working rights are in need of modernisation to keep up with new ways of working.