Recommendations for the National Minimum Wage

Numerous mechanisms are used to set minimum wages around the world. Following its first year in office the Low Pay Commission (LPC) set down the issues and principles which it considered were of particular importance in terms of the concept of a minimum wage, and set out the approach that it believes best suits the Irish situation. By and large these issues and principles adopted remain unchanged in 2017. A key policy principle put forward by the OECD, following its review of the role of minimum wages after the recent economic crisis, can be summarised as follows: “Use minimum wages as a tool to raise wages at the bottom of the wage ladder, but accompany them with other tax and benefit measures to effectively fight poverty in and out of work” (OECD 2015). Thus, minimum wages alone are not sufficient as a poverty alleviation strategy. Other policies are required to deal with items such as exceptional housing and childcare costs