The Chamber of Commerce says it welcomes the decision to scrap plans to align the minimum wage with the living wage.
A revised minimum wage proposal announced by the Department for Enterprise this week now will only see one increase to £12.25, in April.
After raising concerns when initial proposals were announced in January, Chamber said it “appreciates government must ensure that Isle of Man minimum wage rates remain competitive, and that lower paid workers are being affected by the rising cost of living too”.
It added: “However, our members and the wider business community felt strongly that the initial proposals would have had a significant impact on businesses in sectors already under pressure due to other rising costs, many of which have provided the backbone of the island’s economy for decades.
“In this context there was a serious risk that the original proposals could have been the last straw that led to more business closures and job losses. We are therefore pleased that Government has listened and revised the proposals that will be put before Tynwald.”
Chamber has also welcomed the moves by government to review its current methodology regarding the minimum wage and living wage.
It added: “While this is all positive news, we see it as a short-term fix to long-term issues. Looking further ahead, we will therefore continue to encourage government to give more thought to alternative strategies instead of increasing the minimum wage above the rate of inflation.”
It has suggested that could include a decision to increase tax thresholds for lower paid workers to “put more money in people’s pockets and reduce the burden on businesses”.
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