From April 2016, all workers aged 25 and over will be legally entitled to at least £7.20 per hour. The current national minimum wage is set at £6.70, so this represents an extra fifty pence per hour for eligible employees.
Employers in the healthcare, retail and hospitality sectors are likely to be most affected.
Here are Clayton & Brewill’s four tips to help you prepare for the National Living Wage:
Workers aged 25 or over and not in the first year of an apprenticeship will be legally entitled to at least £7.20 per hour. The Government is committed to increasing this every year, so by 2020 it will be more than £9 per hour.
Have in place a system so that when younger workers turn 25, they are paid at the correct rate.
Employers will need to consider how they will accommodate the increase in labour costs, particularly those in labour-intensive sectors such as services and hospitality. It is important to assess the impact across the whole remuneration spectrum as higher basic pay also means higher holiday pay, sick pay, bonuses and pension contributions.
You’ll need to make sure you’re paying your staff correctly from day one, as we understand that the National Living Wage will be enforced as strongly as the current National Minimum Wage.
Tell any workers as soon as possible if they are going to see changes in their salary.
Clayton & Brewill provides audit, tax and advisory services to individuals, owner managed businesses and SMEs across the Midlands, from its network of offices across the region in Nottingham, Long Eaton and Melton Mowbray.