National Living Wage

National Living Wage – has come into force

The National Living Wage (NLW) is to take effect from 1st April 2016 and it favors the workers or employees at the age of 25 and above. This policy indicates that every worker above the said age is to be paid a minimum wage of £7.20 per hour while the present National Minimum Wage standards for those below the age of 25 will keep on.

The National Living Wage demands that every employer should pay the set rates promptly to all the workers covered by the National Minimum Wage which include:
  • Casual Labourers
  • 25 years or above aged apprentices who have completed their first apprenticeship year
  • Employees
  • Agricultural workers

Penalties For Those Who Fail to Cooperate

Those employers who fail to comply with the guidelines will get a 200% fine of the amount pending payment to each worker if failed to be settled within the first 2 weeks.

Also, a maximum fine of up to £20,000 for every worker who is not correctly handled will be charged on the employer. The employer or employers also run the risk of being demoted as the company director for at least 15 years.

There is also a team that has been approved by HM Revenue and Customs to reinforce the directive and to persecute the outlaws.

How to Know if You Are Getting a Fair Pay

If you are 25 years and above and employed, look out for this month’s wages and check whether it’s £7.20. If it is not, you should raise concerns to your employee or even have to confirm with the authorities of the relevant department, that is the industrial relations body (ACAS)

What This means

This directive is expected to give a pay rise of 1.3 million workers in UK and it is meant to help achieve the target of £9 per hour by 2020. Most employers have promised to give wages higher than that to their workers.

Although, some employers fear that in their effort to keep up to the said standards and the company’s productivity, many employees will have to loose their jobs and probably get replaced by machines which means that most customers should see for more automatic checkouts very soon.

According to the extensive research done by the forecasters of the government’s independent economy research body, the Office for Budget responsibility, it is possible that 60,000 workers will loose their employment to make this happen. But also based on the studies of comparing the market either with the minimum wages or not, the result has shown that there will be little or no effect on the current employment trends.

Should you prefer to concentrate on your business, and at the same time comply with all legal requirements, we can produce your payroll for a small monthly fee.


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