Increases in the minimum wage came into effect yesterday (Monday), but a leading trading union warned some companies may not be ready.

Workers aged 18 and above are now entitled to receive a base rate of £7.85 per hour. This equates to an increase of 35p for workers over 25 years, 65p for workers aged 21 to 24, and £1 for workers aged 18 to 20.

Workers above compulsory school age but not 18 will see their minimum wage rate move from £5.70 to £5.85, while the rate for development workers - aged 18 and above, in the first six months of employment and receiving government-accredited training - rises from £6.85 to £6.95.

But public sector union Prospect said the government had not done enough in advance to warn employers.

’Until today there has been little by way of visible and high-profile reminders or notification that the proposals were actually approved by Tynwald,’ said negotiations officer Mick Hewer.

He warned that many smaller companies may not have altered their payroll systems to reflect the changes, and that low-paid workers may not be aware of what they are entitled to.

’I am aware during conversations with people that they are unaware of the changes, particularly those who fall into the younger age bracket,’ he said.

’Additionally, there has been little publicity about where workers can take their concerns and seek advice if they believe their employer is not applying new rates of pay correctly.’

He added that, despite those concerns, the increases were welcome.

Tynwald approved the changes in July, which also saw the effective removal of certain age categories.

However, the rate remains significantly lower than the voluntary ’living wage’.

Enterprise Minister Laurence Skelly said: ’We believe these changes balance the needs of employers and our working population.

’They position the Isle of Man as a progressive, diverse and attractive place to live and work, while simplifying guidelines for local employers.’

He said the Department for Enterprise and Treasury would ’consider further’ a proposal to keep increasing the statutory minimum wage on a yearly basis with a view to bringing it in line with the voluntary Manx ’living wage’ level.

Earlier this year, Tynwald also approved the introduction of the optional ’living wage’, at the much higher rate of £8.61.

The concept is a voluntary one, as opposed to minimum wage, which is mandatory for employers.

Although he has pledged his support for the living wage, Chief Minister Howard Quayle has not committed to a timescale for ensuring all government workers are paid it.

Figures released in June showed about 1,200 workers in the Isle of Man were earning below the living wage and more than one tenth - 123 - were employed by the government.

Mr Hewer said Prospect wanted firm action on bringing the minimum wage in line with the living wage, rather than a pledge to keep looking at it.

He said: ’Investigating is not the same as implementing. Words don’t help pay the bills.’