Study finds payment of sub-minimum wage rates for young people is very rare in Ireland

Being paid a 'youth rate' doesn't impact on future education or work decisions...

A study has found that paying workers who are aged under-18 less than the minimum wage doesn't impact their education or work decisions later in life.

Under 18s can be paid less than the National Minimum Wage for adult workers. 

But research by the ESRI and the Low Pay Commission found that only a tiny proportion of the workforce is paid that rate. Less than 6% of employees aged below 18 were in receipt of the youth rates in 2009 in Ireland.

Commenting on the research, Dr. Elish Kelly, Senior Research Officer at the ESRI, stated, "One debate around sub-minimum rates is the extent to which variations in the sub-minimum wage rates will impact the extent of early school leaving. Given the low incidence of young people in receipt of the youth rate in Ireland, this would suggest that such direct impacts, at least in 2009, are likely to have been small."

The research found that over two-thirds of OECD countries have statutory minimum wages and, of these, just under two-thirds have special rates for young people (15-24).

Most countries’ sub-minimum wage rates for young people are age-based, but there are a few exceptions, such as France where a young person’s work experience level is taken into consideration.

Minister Breen, Minister for Employment and Small Business said, "I asked the Low Pay Commission to  report  on prevalence and impact of sub-minimum wage rates for young people, to give a better understanding of the impact of sub-minimum wage rates and the extent to which they are applied.

"The joint report published today by ESRI and the Low Pay Commission will assist the Government to understand the impact of sub-minimum wage rates for young people. I would like to thank the Low Pay Commission and ESRI for completing this valuable work."