An employment tribunal in Liverpool was told how Samantha Kaye, 18, was paid just pounds 58 for a 38-hour week, but should have been earning pounds 114. On the day the legislation was introduced on 1 April, the salon owner said she could not afford to pay Ms Kaye the pounds 3 an hour due to her and reduced her working week to 20 hours.
Ms Kaye quit the job at the salon in Warrington. The tribunal ruled that she had been constructively dismissed. Jane Goodland, a Citizens Advice Bureau lawyer representing Ms Kaye, said the employer, Janet Caldwell, had failed to demonstrate that her action had been "reasonable".
If the employer had been able to show that her business would have gone under if Ms Kaye had worked a full week on the national minimum wage, the tribunal might have ruled against her client, said Ms Goodland. "Mrs Caldwell had a contractual obligation to my client, she had a responsibility to fulfil her contract," she said. "My client was not a junior. She had passed her National Vocational Qualification in hairdressing and she was only earning pounds 58 for 38 hours."
Ms Kaye, who has since secured a full-time job on pounds 3 an hour at a hairdresser in the centre of Warrington, was awarded pounds 589 for loss of earnings and loss of statutory rights. Mrs Caldwell told the hearing: "Samantha was a good worker. We got on well socially and at work. I couldn't guarantee her full hours week in, week out, but she wouldn't be losing money and she'd have 18 hours more free time."
In making his decision, Eryl Lloyd Parry, chairman of the tribunal, conceded that the award was relatively small, but it reflected the "friendly way" Mrs Caldwell had acted towards Ms Kaye. Ms Goodland said the decision was important because it showed how the law would operate in cases where employers tried to evade the minimum wage. She said the advice bureau in Warrington had received a considerable number of inquiries about the law before its introduction, but there were no other cases pending in her area. Ms Goodland said there had been more inquiries on the European Working Time Directive, which introduced a maximum 48-hour week. Under the minimum pay legislation, workers between the ages of 18 and 21 must receive at least pounds 3 an hour, while those aged 22 and over are covered by a minimum of pounds 3.60. Young people under the age of 18 are not covered by the law.
Hairdressing industry leaders say the minimum wage has had a significant impact, forcing up prices in some areas by pounds 1 per haircut. Ray Seymour of the National Hairdressers' Federation said: "Most salons have faced increased wage bills because of the national minimum wage." But a Department of Trade spokeswoman said: "Independent research has shown that in sectors such as hairdressing, the national minimum wage has had little impact."