Minimum wage law pushes up average pay

Wages in hotels and catering have risen by 4% in the past year, according to a new report, against an increase for the rest of the workforce of 3%.

The higher-than-average rise has been caused by minimum wage legislation. In the previous 12-month period, the average increase across all hospitality workers was 3.5%.

The survey of 62 hospitality groups shows that while some companies give their lowest rate as £3.60, the legal minimum wage, many are paying more.

"It is clear that upward pay pressures from the minimum wage have impacted significantly as firms have adjusted to the new regulations," said Phil Pearson, author of the survey publishedby Industrial Relations Services, an independent employment research company.

But performance-related pay deals are still unusual, said the report. And those that do operate government-approved schemes, such as profit-related pay (PRP), may not continue them after 2000.

The report cites hotel groups Swallow and De Vere as two companies that have PRP schemes due to end in 2000 and no plans to replace them.

• The bulletin costs £190 from Industrial Relations Services: 0171-354 5858.