The Low Pay Commission has launched a consultation on the accommodation offset under the national minimum wage (NMW) and is seeking views from both workers and employers. This is of relevance to colleges where the institution provides staff with accommodation as part of their employment.

The NMW was introduced in 1999 by the National Minimum Wage Act 1998. It gives workers the right to a specified minimum hourly rate of pay, which is regularly updated. The value of most benefits in kind does not count towards the NMW. However, where accommodation is provided as a benefit in kind (i.e. without charge by the employer), an amount equal to the accommodation allowance can be added onto the total remuneration when calculating pay for NMW purposes. The accommodation allowance is currently set at a daily limit of £4.73 (£33.11 a week).

Each year the Low Pay Commission reports on the effect of the NMW and makes recommendations to the government in an annual report. The government has asked that the 2013 report focus on a number of key areas including the accommodation offset.

The aim of the consultation, which takes the form of a short online survey, is to understand how far the offset protects low-paid workers and to see if there is any evidence that the level of the offset has deprived workers of accommodation which an employer would otherwise have offered.

The survey covers issues such as:

  • Why accommodation is provided
  • How much workers are charged for accommodation (and what is included in this charge)
  • How much it costs employers to provide the accommodation
  • The standard of the accommodation provided
  • Whether taking the accommodation was a requirement of the job
  • The benefits to the worker and the employer of the worker being in employer-provided accommodation
  • Changes in the amount of accommodation provided.

The deadline for responding to the consultation is 10 September 2012. The Commission also launched a separate consultation in June seeking views on wider aspects of the NMW. This closes on 17 September 2012.