Minimum Wage Systems
in Other Countries
1 This appendix updates the information on overseas minimum wage systems in the 12 OECD countries that we have looked at in previous reports. The information has been derived from contributions provided by British Embassies, High Commissions and the Organisation for Economic Co-operation and Development (OECD). We are grateful for their continued assistance.
2 In Table A5.1 we provide a comparison of minimum hourly wage rates across the 12 countries, together with the UK, as at the end of 2008. The UK minimum wage is sixth highest of the 13 countries we examined in terms of exchange rates and fourth highest in terms of purchasing power when OECD Comparative Price Levels for November 2008 are used (latest data available). This has changed since our 2008 Report. In 2008 the UK minimum wage was fourth highest in terms of exchange rates and third in terms of purchasing power when OECD Comparative Levels for September 2007 were used.
3 Table A5.2 measures minimum wage rates relative to full-time median earnings in each country (the bite). This information has been supplied by the OECD and is for the latest available period (mid-2007). The UK minimum wage as a proportion of median earnings is ranked in the middle of the 13 countries shown, a position unchanged from our 2008 Report. We have regarded median, rather than mean earnings, as the most appropriate comparator because of the disproportionate influence a relatively few high earners have on mean earnings.
4 As part of the Government’s evidence to us on the economic effects of the minimum wage (BERR, 2008f), they provided international comparisons of the minimum wage as a percentage of median earnings (the bite). Figure A5.1 shows that the bite of the UK minimum wage is above the G7 average and fourth highest in its list of 13 countries. The comparisons, however, are limited by differences in data methodologies.
5 As in previous reports, we also describe the approaches adopted across countries for uprating their minimum wages (Table A5.3), enforcing the provisions (Table A5.4), and applying age variations under minimum wage systems (Table A5.5). We compare youth minimum wage rates as a percentage of adult minimum wage rates in Table A5.6. In most cases, there has been little to update since we reported on these in 2007.
6 This year, taking into account our remit to review current apprentice exemptions, we requested information from British Embassies and High Commissions on details of exemptions from the minimum wage for apprentices in the 12 OECD countries we report on. We received responses for 9 countries, which are detailed in Table A5.7 along with arrangements for the UK.
7 In the following section we report on developments among the countries with an established minimum wage, including Australia and New Zealand and provide information where there is the possibility of a minimum wage being introduced. In Germany and Sweden there is a debate about the possibility of implementing a statutory national minimum wage. In Guernsey it was announced in March 2009 that legislation to introduce a statutory minimum wage will be sent for approval by the UK Privy Council. Since our 2008 Report, we have been consulted by representatives from a number of countries about the operation of our minimum wage arrangements, including South Korea, Germany and Hong Kong.
8 Caution should be applied to drawing comparisons between countries, as definitions of what counts towards the minimum wage differ. There are also differences with regard to the age at which the minimum wage rate(s) apply, whether there are any exemptions, and in the overall coverage of the respective mechanisms. In addition, anniversary dates vary, with some countries expected to increase their wage rates again in 2009.
Country Updates
Australia
9 In April 2008 the Australian Government announced that the Australian Fair Pay and Conditions Standard, which sets out the base minimum conditions of employment, such as working hours, minimum wage, annual leave, sick leave and parental leave, would be replaced by the National Employment Standards. It is expected that the NES will come into being in January 2010.
10 The Australian Government announced in May 2008 that it would increase the minimum wage for workers in Australia on temporary skilled worker visas, to help ensure they are not exploited. Under the changes, workers on the visa’s minimum wage will receive a 3.8 per cent pay increase, taking the standard minimum annual salary to about $43,440 for a standard 38 hour week for most occupations.
11 The Australian Fair Pay Commission, established in 2005, has embarked on a review of the minimum wage for 2009 ahead of its next wage-setting decision in July 2009. The review will consider information gathered from research, consultations and submissions, and will assess the impact of the uprating of the minimum wage to $14.31 per hour in October 2008. The closing date for submissions was 20 March 2009, with consultations and focus groups taking place around the country up until the end of April 2009.
Austria
12 On 2 July 2007 the Austrian social partners of employers and trade unions agreed on the introduction of a monthly minimum wage of €1,000, payable fourteen times a year, by 2009. Minimum pay regulations are not set by statutory law (except for the public sector) but are laid down in sectoral and branch level collective agreements. About 98 per cent of employees are covered by sectorally agreed minimum wage rates, due to the country’s high level of collective bargaining coverage. Wage levels vary across sectors and are dependent on the bargaining power of trade unions.
Germany
13 In our 2007 Report we noted that a public debate, which had commenced in 2005, continued to take place in Germany over the possibility of introducing a national minimum wage. In Germany there is no statutory minimum wage, although new legislation has led to the extension of sectoral minimum wages. In sectors where more than 50 per cent of employees are covered by collective wage agreements, these agreements can now be made binding for all companies in the sector. In sectors where less than 50 per cent of employees are covered by sectoral agreements, the Government can now decide on the introduction of a minimum wage based on the analysis of a council of experts. On 22 January 2009 the Grand Coalition voted to extend the rules to six sectors, including security guards, carers and waste collectors. A separate Cabinet agreement is expected to set a wage floor for temporary agency workers, which would mean 3.7 million of Germany’s 40 million workers will be covered by minimum wage legislation.
Guernsey
14 Following a consultation process in 2007, the Commerce and Employment Department proposed that minimum wage legislation should be implemented in Guernsey. In March 2009, it was announced that the Guernsey States had voted to introduce a minimum wage. The legislation is in the drafting process and a consultation will take place with representatives of employers and employees, before being sent for approval by the UK Privy Council. At the time of writing, details about who the minimum wage will apply to and how the rate will be calculated have yet to be decided. When the minimum wage legislation is introduced, employers will be required to keep records which demonstrate that the hourly rate of pay complies with the minimum wage.
Hong Kong
15 Chief Executive Donald Tsang announced on 15 October 2008 that Hong Kong is to introduce legislation on a statutory minimum wage. This will be the first time Hong Kong has imposed a legally enforceable minimum wage. The Government of the Hong Kong Special Administrative Region (HKSAR) plans to introduce an across-the-board statutory minimum wage and aims to take a bill to the Council in the 2008–09 legislative session. HKSAR will establish an advisory Minimum Wage Commission to study and advise on the level of minimum wage.
Ireland
16 The minimum wage was last uprated in July 2007 to €8.65. At the request of the Irish Congress of Trade Unions, the Labour Court is currently examining the national minimum hourly rate of pay and has been asked to make a recommendation to the Minister for Enterprise, Trade and Employment on a new minimum wage rate.
Netherlands
17 The Ministry of Social Affairs normally uprates the minimum wage twice a year on 1 January and 1 July. In January 2009 the minimum wage was uprated to €7.97 per hour or €318.75 per week, with a new rate expected on 1 July 2009.
Sweden
18 In Sweden, minimum wages are traditionally fixed by sectoral collective bargaining. In the past, public debate on minimum wage issues has been limited. This changed on 18 December 2007 however, when the European Court of Justice (ECJ) announced its judgement on the Laval case, which concerned construction workers posted by a Latvian company in Sweden. Under the Posted Workers Directive, which came into force in 1996 and applies to all EU countries and EEA countries, firms from member countries temporarily operating in another member country should not pay wages below the legal minimum wage in the host country.
19 The ECJ ruled that the minimum wages in construction were not clearly defined and some modification of the Swedish model would be necessary. The Swedish Government reacted to the court’s ruling by initiating the preparation of an official report presented in December 2008, with suggestions on how to preserve the structure of the current model without it coming into conflict with EU law. Views on implementing a national minimum wage are mixed. The Association of Swedish Engineering Industries has called for national minimum wage legislation, whereas other organisations, including the Swedish Trade Federation, oppose minimum wage legislation.
United States
20 President Barack Obama had indicated his support for a higher federal minimum wage, seeking to increase it to $9.50 an hour within 3 years, and tying it to inflation. The federal minimum wage is currently $6.55 an hour and is set to increase to $7.25 an hour in July 2009. At present, 23 states have a higher minimum wage than the rate set by the federal Government.
New Zealand
21 On 1 April 2008 the youth minimum wage, which had previously applied to employees aged 16–18, was replaced with a new entrants’ minimum wage. The new entrants’ minimum wage is equivalent to 80 per cent of the minimum wage. A new entrant is a worker who is 16 or 17 years old, unless they have completed three months or 200 hours of employment, whichever is shorter; they have supervised or trained other workers; or they have been subject to the minimum training wage.
Comparison of Minimum Wage Systems
Table A5.1 Comparison of Level of Minimum Wagesa Across Countries, 2008
Source: British Embassies, High Commissions and OECD Minimum Wage Database. LPC calculation of exchange rates and PPPs. PPPs derived from CPLs, OECD Main Economic Indicators, November 2008. For exchange rates, Bank of England monthly average spot exchange rate, November 2008.
Notes:
a. In all cases, the minimum wage refers to the basic rate for adults.
b. For countries where the minimum wage is not expressed as an hourly rate, the rate has been converted to an hourly basis assuming a working time of 8 hours per day, 40 hours per week and 173.3 hours per month.
c. November 2008.
d. Purchasing Power Parities (PPPs) derived by applying OECD Comparative Price Levels (CPLs) – ratio of PPPs for private consumption to exchange rates – for November 2008.
e. Exemptions and special rules apply in many cases. For example, in France and the United States the full adult rate applies to young workers with a tenure of more than 6 and more than 3 months respectively.
f. Federal minimum wage – hourly rate under Fair Pay Commission arrangements.
g. Weighted average of provincial/territorial rates.
h. Date of last uprating varies between provinces.
i. For blue collar workers.
j. Weighted average of prefectural rates.
k. Age 15 to receive the regional minimum wage. Age 18 to receive the sectoral minimum wage.
l. Excludes 8 per cent supplement for holiday pay.
m. Not including annual supplementary pay of two additional months of salary for full-time workers.
n. Federal minimum wage. Tipped employees receive a lower minimum wage of $2.13 per hour in direct wages.
Table A5.2 Adult Minimum Wages Relative to Full-time Median Earnings, by Country, 2007a
Source: OECD estimates based on OECD Earnings Structure Database, minimum wages and median earnings for full-time workers, July 2007.
Notes:
a. In all cases, the minimum wage refers to the basic rate for adults. In some cases, the median earnings data for full-time workers for mid-2007 are estimates based on extrapolating data for earlier years in line with other indicators of average earnings growth. All earnings data are gross of employee social security contributions.
b. Two estimates of median earnings are available based on the Labour Force Survey (LFS) and an Enterprise Survey (ES). In each case, the data refer to weekly earnings. The minimum wage refers to the Federal Minimum Wage.
c. Minimum wage for blue collar workers.
d. Differs from the LPC estimate in Chapter 2, as the OECD estimate is for the minimum wage relative to the median earnings of full-time, rather than all, employees.
e. The ratio including 8 per cent supplement for holiday pay is given in parentheses.
f. The ratio including annual supplementary pay of two additional months of salary is given in parentheses.
Figure A5.1 Adult Minimum Wages Relative to Median Earnings, by Countryab, 2008
Source: Government evidence to the LPC on the economic effects of the National Minimum Wage, December 2008. (BERR, 2009f)
Notes:
a. National minimum wage rates used may vary from those used in both Table A5.1 and Table A5.2.
b. Earnings periods used vary between countries, and in most cases differ from that used in Table A5.2.
In addition Table A5.2 uses median earnings of full-time, rather than all, employees.
Table A5.3 Uprating of Minimum Wages, by Country, 2008
|
|
Australia |
In April 2008 the Australian Government announced that the Australian Fair Pay and Conditions Standard (AFPCS), which sets out the base minimum conditions of employment, such as working hours, minimum wage, annual leave, sick leave and parental leave, will be replaced by its National Employment Standards. It is expected that the National Employment Standards will come into being in January 2010. |
Belgium |
The minimum monthly average guaranteed income is set for the private sector by a collective employment agreement reached at the National Labour Council (social partners). All workers benefit from salary indexation which is currently set at 5.1 per cent until 2010 (this varies according to inflation). |
Canada |
In most provinces, minimum wages are fixed (and increased) by regulation. A provincial Governor-in-Council has the authority to change regulations which are frequently based on recommendations of a Minimum Wage Board, Review Committee, Labour Standards Board or the Minister of Labour.
In Quebec, minimum wage increases are based on eleven indicators, including the ratio between the minimum wage and the average hourly wage. However, increases are still made by regulation.
In the Yukon, the Employment Standards Board now provides regular annual minimum wage rate increases for the following year based on the consumer price index for the territory’s capital.
In the Northwest Territories and Nunavut, minimum wage rates are set by statute, therefore any rate increases require a legislative amendment to be passed by the legislature.
The rate for the federal jurisdiction is the general adult minimum wage rate of the province or territory where the work is performed. |
France |
The minimum wage is reassessed each year on 1 July. The uprating must be at least half that of the increase in purchasing power of the average hourly wage. During the course of the year if the price index increases by over 2 per cent, the minimum wage is increased automatically by the same amount. The Government can also increase the minimum wage at any time. |
Greece |
The statutory minimum wage is laid down in the National General Collective Labour Agreement (NGCLA) and applies to all workers in the private sector (civil servant pay levels are set separately by the Government). The NGCLA is the result of negotiations between the social partners. Since the mid-1990s it has covered a two-year period and upratings take account of past and anticipated levels of inflation and other factors, including the national level of productivity. Increases in the minimum wage take place once or twice yearly. |
Ireland |
The national minimum wage can only be increased following a recommendation in a national agreement. Where there is no national agreement, any organisation which the Labour Court is satisfied is substantially representative of employees or employers can ask the Labour Court to examine the national minimum hourly rate of pay, not earlier than 12 months after the Minister last declared a national minimum hourly rate of pay. The Labour Court can then make a recommendation to the Minister. |
Japan |
The system operates regionally. The minimum wage is reviewed and amended each autumn. The Central Minimum Wage Council makes recommendations to the 47 Regional Minimum Wage Councils, comprising representatives of labour unions, employees and public agencies. It makes a proposal based on their consideration of the cost of living, salary of workers in similar industries, and the financial capability of employers. The final decision is made by the Director of the Regional Labour Standard Agency.
In addition, if specific industries believe it is necessary to set a higher rate than the regional minimum wage, they can set their own rate by industry within the prefecture. The labour and management representatives of the industry must submit the rate to the Regional Minimum Wage Council. It is not uprated every year; it is reviewed on request by the industry. |
Netherlands |
The Ministry of Social Affairs normally uprates twice yearly (on 1 January and 1 July). Wage inflation is used to determine by how much the minimum wage is increased. An average figure is derived from all the sectoral Collective Agreements. There are circumstances, however, when the Government can decide not to increase the minimum wage. The Government, in consultation with the social partners, may decide not to link the minimum wage to average contractual wage rises if it considers that the ratio between the number of people claiming social benefits and the number of people working is rising too fast. This happened between 1993 and 1996 and in 2004/05. A major evaluation of the minimum wage system is carried out every four years, mainly to consider whether the level is too high or too low compared with average wages and the overall condition of the labour market. |
New Zealand |
The Minister of Labour conducts annual reviews in accordance with the Minimum Wage Act 1983 by 31 December of each year. The reviews consider the effectiveness of the minimum wage in meeting its objectives and there are set criteria for reviewing changes to the minimum wage. The Minister invites submissions from the New Zealand Council of Trade Unions and Business New Zealand, as well as other organisations. The Minister makes recommendations to Cabinet on the basis of these submissions and analysis undertaken by government departments. Amendments to the minimum wage usually come into force on 1 April of the following year. |
Portugal |
Up until 2006, an Inter-Ministerial annual review considered the social and economic effects of the minimum wage. This included the expected inflation rate and productivity levels. Following consultation with the social partners, the wage was usually uprated annually and implemented from January of each year. However, from 2007 a tripartite committee (with representatives from Government, unions and employers) has monitored economic conditions (including inflation, GDP and productivity), to consider the social and economic impacts of the minimum wage and issue a recommended annual upgrade. Following consultation with the social partners, and taking the medium-term objectives (minimum wage to rise to €500 by 2011) into consideration, the Government sets the annual increase, to be implemented from January of the following year. |
Spain |
The Government uprates annually following consultation with the social partners. The Government is obliged to take account of inflation, average national productivity, participation levels and general economic conditions. Spain’s Prime Minister, José Luis Rodríguez Zapatero, has pledged to increase the minimum monthly wage to 800 euros by 2012. |
UK |
The Government considers recommendations from an independent Commission, which reports following wide-ranging consultation and consideration of the effects on the economy, as well as on specific sectors and groups of workers. Since the minimum wage was introduced in 1999 there have been annual upratings. |
US |
Changes to the federal minimum wage are voted on by Congress intermittently. Most states have their own minimum wage rates. Where federal and state laws stipulate different rates, the higher rate applies. |
Source: British Embassies, High Commissions and LPC.
Table A5.4 Enforcement of Minimum Wages, by Country, 2008
|
|
Australia |
Under the Federal jurisdiction, complaints are lodged with the Office of the Workplace Ombudsman and are investigated by inspectors. Employees can also refer claims to a Small Claims Court (in which case the Workplace Ombudsman suspends any investigation pending the court decision). Similar processes apply in State jurisdictions. |
Belgium |
The Federal Labour Inspectorate is responsible for all matters of Labour Law enforcement. A special division is dedicated to the control of Social Laws, which also gives legal advice to individuals and Labour Unions. |
Canada |
In each jurisdiction, the employment or labour standards legislation contains provisions for the enforcement of minimum wage requirements and the payment of wages. While the system of enforcement varies across the country, generally complaints regarding unpaid wages or a violation of minimum wage requirements may be made to the labour standards branch. Labour standards inspectors also have the legal authority to perform random inspections to ensure compliance. |
France |
Labour inspectorate (which is also responsible for general conditions of work, and health and safety). Inspectors carry out random checks and investigate complaints from trade unions and individual employees. |
Greece |
Labour inspectorate. Employers can be sued by employees, who have to pay their own costs, or by inspectors. |
Ireland |
The national minimum wage is enforced by Labour Inspectors in the National Employment Rights Authority, who conduct both routine inspections and investigate complaints. Disputes can be referred to the Rights Commissioner Service of the Labour Relations Commission. |
Japan |
Labour inspectorate. It can fine employers up to ¥500,000 if they pay less than the regional minimum and up to ¥300,000 if they pay less than the sectoral minimum wage. Employees can report any breach of such laws to the Regional Labour Standard Agency, the Labour Standards Supervision Office or the Labour Standards Inspector. If an employer dismisses or treats the employee(s) unfavourably for such reporting, the employer will be punished with a fine of up to ¥300,000 or sentenced to up to six months in prison. |
Netherlands |
Labour inspectorate periodically reports on the application of the minimum wage in practice. Employers are informed of pay below the minimum wage but the Labour inspectorate is not able to take employers to court; the employee must do this. |
New Zealand |
Labour inspectorate may take action in the Employment Relations Authority or the Employment Court to recover wages owing, plus penalties. Alternatively Labour Inspectors may issue a demand notice requiring that the employer pay monies to an employee, as assessed by the Labour Inspector. Complaints received from a person other than the employee are investigated. |
Portugal |
The labour inspectorate is responsible for enforcing labour legislation and regulations governing general working conditions, including the minimum wage. Inspectors carry out random checks and investigate complaints from trade unions and individual employees. |
Spain |
Labour inspectorate (which also has the power to enforce a wide range of labour issues, including collectively-bargained rates). It can fine employers, or the employee can take the case to tribunal to obtain back pay. The system is both reactive and proactive. There are around 600 inspectors and 800 assistants, stationed on a provincial basis. |
UK |
HM Revenue and Customs is the enforcement agency. It conducts both proactive, targeted enforcement and investigation of complaints. Employees also have the right to take their case to an Employment Tribunal. There is a free telephone helpline, with all calls followed up, including anonymous complaints. |
US |
Wage and Hour Division in the Department of Labor is responsible for enforcing the federal minimum wage. It both pursues complaints and is proactive, targeting specific low wage industries. There is a team of approximately 750 inspectors nationwide. |
Source: British Embassies, High Commissions and LPC.
Table A5.5 Age Variations Under Minimum Wage Systems, by Country, 2008
|
Treatment by Age |
Australia |
Junior rates contained in Australian Pay and Classification Scales (Pay Scales) vary across industries and occupations. Typically a sliding scale applies from age 16 (40–50 per cent of the adult minimum wage) through age 18 (65–80 per cent) to age 20 (85–100 per cent). Adult wages apply at age 21. |
Belgium |
Full minimum wage applies at age 21. An additional premium is payable to workers aged 21½ who have been employed for at least 6 months and to workers aged 22 who have been employed for at least 12 months. There is a 6 per cent deduction from the minimum wage for each year below age 21, with those aged 16 or under receiving 70 per cent of the full rate. |
Canada |
Full minimum wage at all ages except in Ontario, which has retained youth rates. Both British Columbia and Nova Scotia have introduced a first job/entry-level wage rate for workers new to the paid labour market. |
France |
Full minimum wage at age 18. Certain categories of young people receive a reduced rate, provided they have worked less than six months in a sector (80 per cent for those aged 16 and 90 per cent for those aged 17). |
Greece |
Full minimum wage at age 15 (but variation depending on length of employment and marital status). |
Ireland |
Full minimum wage applies to an experienced adult employee (which is an employee who is not (i) under age 18 or (ii) in the first two years after the date of first employment over age 18 or (iii) undergoing structured training or study). Employees in the first year after the date of first employment over age 18 are entitled to 80 per cent of the full minimum rate and 90 per cent in the second year. Employees under age 18 are entitled to 70 per cent of the full adult rate. |
Japan |
The regional minimum wage applies to employees over 15 years old. The sectoral minimum wage applies to employees aged between 18 and 64. |
Netherlands |
Full minimum wage at age 23. Youth rates are 30.0 per cent at age 15, 34.5 per cent at age 16, 39.5 per cent at age 17, 45.5 per cent at age 18, 52.5 per cent at age 19, 61.5 per cent at age 20, 72.5 per cent at age 21 and 85.0 per cent at age 22. |
New Zealand |
From 1 April 2008 all employees aged 16 years and over are entitled to the adult minimum wage, except for new entrants and employees to whom the training minimum wage applies. The new entrants’ minimum wage and the training wage are equivalent to 80 per cent of the minimum wage. |
Portugal |
Full minimum wage at age 16. Exceptions are apprentices and trainees in qualified or highly qualified jobs, who can receive 80 per cent for up to a year, or 6 months if the course is technical/professional. |
Spain |
Full minimum wage at age 16. Young people who were unemployed but join various training schemes to help them to enter the labour market receive 75 per cent of the minimum wage. |
UK |
Full minimum wage at age 22. Separate rates exist for 16–17 and 18–21 year olds (currently 62 and 83 per cent respectively of the adult rate). |
US |
Full minimum wage at all ages, except below age 20 where lower rate of $4.25 can apply (approximately 82.5 per cent of full minimum wage) for the first 90 days in any job. Also full-time students can be paid 85.0 per cent of the minimum wage. Additionally, student-learners (those aged 16 and over who are enrolled in vocational education) can be paid 75.0 per cent of the minimum wage while on the vocational education programme. |
Source: British Embassies, High Commissions and LPC.
Table A5.6 Youth Minimum Wages as a Percentage of Adult Minimum Wage Rates, by Country, 2008
|
|
|
|
Australiaa |
50 |
60 |
75 |
Belgium |
70 |
76 |
85 |
Canada |
100b |
100b |
100 |
Francec |
80 |
90 |
100 |
Greece |
100 |
100 |
100 |
Ireland |
70 |
70 |
85 |
Japan |
100 (regional)
0 (sectoral) |
100 (regional)
0 (sectoral) |
100 (regional)
100 (sectoral) |
Netherlands |
34.5 |
39.5 |
49 |
New Zealand |
80 |
80 |
100 |
Portugal |
100 |
100 |
100 |
Spain |
100 |
100 |
100 |
UK |
62 |
62 |
83 |
USc |
82.5 |
82.5 |
82.5 |
Source: OECD Minimum Wage Database, British Embassies, High Commissions and LPC.
Notes:
a. As prescribed in the Pay Scales derived from New South Wales Shop Employees Award. These rates are broadly representative of the rates for younger workers prescribed in other Pay Scales.
b. All provinces except Ontario.
c. For France and the United States, the reduced rates apply to young workers with a tenure of fewer than six months and three months, respectively.
Table A5.7 National Minimum Wages and Apprenticeships, by Country, 2008
|
|
Belgium |
Apprentices and trainees are exempt from the minimum wage. Apprentices aged 16–17 are paid 25 per cent of minimum salary for the first year of the contract, 37 per cent of minimum salary for the second year and 53 per cent of minimum salary for the third year. Apprentices aged 18–20 are paid 41 per cent of minimum salary for the first year of the contract, 49 per cent of minimum salary for the second year and 65 per cent of minimum salary for the third year. Apprentices aged 21 and over are paid 53 per cent of minimum salary for the first year, 61 per cent of minimum salary for the second year and 78 per cent of minimum salary for the third year. |
Canada |
Apprenticeship training and pay is set at provincial level and is dependent on the regions and zones in each of the 13 territories where the apprentice is in training. The hourly salary wages for apprentices range between 50 per cent and 90 per cent of a journeyperson’s wage. The exact percentage depends on the year of the apprenticeship, the occupation and the jurisdiction. The wages and percentages are regulated by the Ministry of Labour (or equivalent) in each jurisdiction. |
Greece |
There are no exemptions from the national minimum wage for apprentices. Apprentices have a statutory entitlement to a wage which is laid down in the National General Collective Labour Agreement. This is voted through Parliament and becomes law. |
Ireland |
National Minimum Wage legislation does not apply to Ireland’s National Training and Employment Authority (FÁS). However, registered employment agreements set out the minimum rates for apprentices working in the Construction and the Electrical Contractor sectors.
Minimum wage rates apply for employees aged over 18, in a course of training or study undertaken in normal working hours. The following employee trainee rates apply: 75 per cent of the minimum wage rate must be paid for the first third period; 80 per cent of the minimum wage rate must be paid for the second third period and 90 per cent of the minimum wage rate must be paid for the third period. The training or study must satisfy prescribed criteria including the requirement that the course must be for the duration of a minimum of three months. |
Japan |
Employees are exempt from the minimum wage only if the employer gets approval from the Head of the Regional Labour Standard Agency. Employees under certified vocational training, which is training approved by the Governor, are exempt from the minimum wage. However, as each exemption is discussed individually, there is little data available. |
Netherlands |
Students studying under the Educational Learning Path Arrangement do not have to be paid the minimum wage and are not subject to the sectoral collective labour agreement. Students are in school five days a week but gain experience during a number of internships with employers.
Students enrolled in higher education and doing an internship with an employer do not have to be paid the minimum wage and do not fall under the sectoral collective labour agreement. An internship contract covers details on pay and allowances.
Students studying under the Learning by Doing Learning Path Arrangement are with an employer for four days a week and spend one day a week at school. These apprentices are required to have signed a labour contract and have to be paid at least the minimum wage. They are also subject to the sectoral labour agreement. |
Spain |
Apprentices combine work with training. The training cannot be less than 15 per cent of an apprentice’s day and their wage cannot be less than the minimum wage, proportionate to their working hours. For example, an apprentice who receives theoretical training for 15 per cent of their day can receive 15 per cent less than the minimum wage.
Individuals on training programmes (for people who have a degree but no professional experience) are a special case. Their remuneration is fixed by a collective agreement but cannot be less than 60 per cent in the first year and 75 per cent in the second year of the agreed salary of an experienced worker doing the same or an equivalent job. |
UK |
Apprentices below the age of 19 and older workers in the first year of an apprenticeship are currently exempt from the minimum wage. Apprentices are paid a contractual rate of £80 per week in England (this is due to rise to £95 in August 2009). No contractual rate in other countries of the UK, although the Scottish Government encourages payment of the minimum wage and the administration in Northern Ireland encourages payment of the appropriate industry rate for the job. |
US |
The United States has a formal apprenticeship program that the Government runs. Anyone aged 16 or older can apply to enter an apprenticeship program. A term of apprenticeship must not be less than 2,000 hours of work experience and must be consistent with training requirements as established by industry practice. A minimum of 144 hours training for each year of apprenticeship is recommended. Apprentices must be paid the minimum wage at the start of the apprenticeship program and their salary must increase during the duration of the program, to be consistent with the skills acquired. |
Source: British Embassies, High Commissions and LPC.
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