The Agricultural Wages Board (AWB) has reached a settlement for minimum wage rates to apply from October 2009 after intense negotiations.

The agreement will see an increase in the Grade 1 rate from £5.74 to £5.81 per hour and for all other grades an increase of 2.2 per cent will apply. The board also agreed to an increase of £10 in the birth and adoption grant, from £50 to £60.

National Farmers’ Union (NFU) employment spokesman Bob Fiddaman said: “This year’s negotiations have been extremely tough and have taken place with the backdrop of a severe economic downturn, falling inflation levels, rising unemployment and uncertainty as to farm incomes.

“We are disappointed that the final settlement goes beyond the percentage increase of 1.9 per cent agreed recently by the Scottish AWB, especially given the degree of competition both sides of the border in industries such as soft fruit. And it is fair to say that the deal was at the very limit of acceptability for the NFU, given the wider employment market situation and market pressures faced by many producers.

“Nevertheless we believe this is a fair outcome, which reflects the CPI figures that were released this week, ensuring farm workers benefit from a wage increase that reflects the increasing costs of household purchases. We are also pleased that the increase for Grade 1 to £5.81/hour has been kept modest. This is critical for sectors like horticulture that employ large numbers of seasonal and low-skilled workers, although we do dispute the case for any differential between this and the National Minimum Wage, recently set at £5.80/hour.

“The key issue in these negotiations for Unite, representing farm employees, was the ability of the farming industry to pay on the back of a substantial increase in aggregate farm incomes last year. As we pointed out, the situation for 2009 is very uncertain given changes in exchange rates, lower milk and cereal prices and pressures in the horticultural sector.

“For the NFU, the key issue was jobs. With unemployment levels having risen to 7.2 per cent (2.26 million) according to the latest quarterly figures released today, we wanted an agreement that preserved the ability of the farming industry to protect jobs and even create opportunities for rural employees. Under these circumstances it was important for any wage increases to be moderated.”