Britain’s bosses urged by the Government to be prepared to pay the National Living Wage
The Department for Business, Innovation and Skills asked 1,000 employers across Britain about the National Living Wage and it revealed that 93% of Britain’s bosses support the initiative of paying the National Living Wage. The National Living Wage will become law on 1 April 2016. 88% of those that took part in the poll believe the move will boost productivity and 83% hope it will make staff more loyal to their firm. Other positive aspects that were identified, were boosting staff morale and believing that customers would be likely to return if the business paid the right rates of pay. This has led to firms being advised to already start taking simple steps.
Currently four steps have been outlined to help better prepare for the introduction of the National Living Wage in 2016 on the day the statutory instrument is laid to write it into law.
These steps urge firms to:
1. know the correct rate of pay – this will be £7.20 per hour for staff aged 25 and over
2. determine the staff that will be eligible for the new rate
3. update the company’s payroll in time for the introduction of the new wage on 1 April 2016
4. communicate the changes to staff as soon as possible
The National Living Wage is a key part of the government’s plan to continue moving to a higher wage, lower tax and lower welfare society. Business Minister Nick Boles has also spoken out for businesses to get ready to start paying the new rate from April as the new National Living Wage will provide a direct boost to over two-and-a-half million workers in the UK. Following the suggested steps will allow companies to properly reward their staff and avoid falling foul of the law when it takes effect.
Even though 63% of bosses say they know who in their business should be getting the new Wage, the poll carried out by the Department for Business, Innovation and Skills however showed that even though the measure has popular support, many firms are yet to take the suggested key steps to prepare for April. Only around 45% had updated their payroll to account for staff aged 25 and over on 1 April 2016; only 39% had communicated the upcoming changes to staff and only 29% had looked online for more information about the National Living Wage entitlement.
The National Living Wage follows recent rises in National Minimum Wage rates to:
• £6.70 for those 21 and over
• £5.30 for 18-20-year-olds
• £3.87 for under 18-year-olds
• £3.30 for apprentices
A website has been set up for employers to find out more at www.livingwage.gov.uk.
