New National Living Wage -1st April
In the first of the statutory changes that takes effect today (the others take effect on the 6th) employers will have significantly more labour costs in their business as a result of this new National Living Wage rate for their workers aged 25 and over. They must now be paid at least £7.20 p.h.
In timely fashion the Department for Business, Innovation and Skills have produced a new 55-page guidance document all about Calculating the National Minimum (and Living) Wage.
Covering how to calculate it, what counts as pay and what hours needs to be counted it is a useful document to refer to ensure compliance. For a copy please Click here
Comment: The NLW may be great news for the lower paid workers but not so good for employers. I dare say there may be a negative kickback from the introduction of the new rate — less bonuses being paid, less normal pay increases across the board, sadly age discrimination may become more common as firms if firms aim to recruit under 25s to pay a lower rate or there will be generally be less recruitment as firms will have to look at costs. Of course they may also put up the cost of their products or services to soak up their extra costs which will be bad for the public. Only time will tell how what the impact is.