LINKING a planned increase in the minimum wage with inflation will provide “much-needed certainty” to businesses, according to the president of the Chamber of Commerce.
Eliot Lincoln’s comments followed yesterday’s announcement that Social Security Minister Elaine Millar had accepted the Employment Forum’s recommendation to raise the main minimum wage rate to £13.97 an hour from April.
The rise of 2.8% is in line with Jersey’s June 2026 RPI figure.
Additionally, Senator Millar accepted a recommendation to implement an equivalent increase in the allowances available to employers for the provision of accommodation and meals to those employees earning the main minimum wage rate.
And she agreed that the Year 1 and Year 2 trainee minimum wage rates should remain at £10.50 per hour and £11.75 per hour respectively for one more year from April.
The minister also noted that the forum had “reflected on the debate about a youth rate and possible changes to the way in which the formal trainee minimum wage policy is currently set”.
She stated: “I will consider carefully the arguments that have emerged from the forum’s consultation exercise and, in particular, whether a further consultation on these aspects should take place.”
The Employment Forum is an independent, non-political public body comprising employee and employer representatives, together with independent members.
Its recommendations were submitted alongside a report that took a range of relevant data into consideration, including average earnings and RPI statistics, as well as written and online consultation responses from employers, employees and organisations.
Summarising feedback submitted by Chamber, which also put forward a
supplementary submission based on a further survey of its membership, the report noted that: “The broad feeling from members is that two years of significant increases have been extremely challenging.
“In terms of the level of the minimum wage, Chamber told the Forum that an above-inflation increase would be a step too far.”
Speaking to the JEP, Senator Millar said: “We have to accept that while there are individuals who will be struggling with the cost of living, businesses will also struggle with the cost of living.
“Every time you increase the minimum wage, there will be elements of that that some businesses can accommodate, can absorb, but there will be other businesses who can’t absorb the cost and they pass them on by increased prices and that will then seep into inflation.”
Senator Millar described the Forum’s report as “very thorough”.
“I think the conclusions are sensible and that’s why I’m deciding to accept them.”
The new rate will be introduced via a ministerial order.
Eliot Lincoln, President of Jersey Chamber of Commerce said: “An increase in line with RPI was a central recommendation from Chamber, supported by the evidence and experiences of our members.
“We are extremely pleased that this has been reflected in the Employment Forum’s recommendations and subsequently accepted by the minister.”
Mr Lincoln continued: “We are grateful to the Employment Forum for listening carefully to the concerns of the business community, and to the minister for recognising the importance of striking a sensible balance between fair pay and the ability of businesses to remain competitive and sustainable.”
Mr Lincoln stated that Chamber “has consistently supported fair pay and the protection of lower paid employees”.
“However, after several years of significant wage increases, businesses have been clear that further rises above inflation would place additional pressure on already stretched budgets,” he added.
“Our members face rising freight costs, increasing operating expenses and continued challenges around recruitment and retention.
“These pressures are particularly acute in hospitality, retail, agriculture and other labour intensive sectors.”
Mr Lincoln added that the linking the minimum wage increase to inflation “offers some much needed certainty, allowing businesses to plan ahead while helping to protect the purchasing power of those on the minimum wage”.
Chamber also welcomed the decision to hold trainee rates at current levels.
