money national living wage comment

Mobility and access companies can expect to pay a higher National Living Wage and National Minimum Wage rates from April 2021, confirmed the Chancellor in today’s Spending Review.

The National Living Wage (NLW) will increase by 2.2 per cent from £8.72 to £8.91, and will be extended to 23 and 24 year olds for the first time. For workers aged under 23, the government accepted in full the recommendation of the Low Pay Commission in October for smaller increases in recognition of the risks to youth employment which the current economic situation poses.

Currently, the National Living Wage is £8.72 an hour and applies to those aged 25 and over. From April 2021, this will be increased to £8.91 – an increase of 2.2 per cent.

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Alongside the increase, Chancellor Rishi Sunak also revealed that the National Living Wage will become the statutory minimum wage for workers aged 23 and over. The government also stated that the threshold will further reduce to 21 by 2024.

According to the government, this change to the minimum wage will represent a pay rise of £345 next year for those over the age of 23.

Workers under 23 will also see an increase to their minimum wages, with the Low Pay Commission recommending smaller increases in recognition of the risks to youth employment which the current economic situation poses.

The announcement will increase cost pressures on companies, particularly retailers, facing an uncertain first quarter and the end of furlough which will close in March 2021.

Helen Dickinson, Chief Executive of the British Retail Consortium, said: “We support the Government decision to adopt the Low Pay Commission’s recommendations for a moderate increase to the New Living Wage. Many retailers are already paying wages above the NLW and will continue to do so into the future.”

Bryan Sanderson, Chair of the Low Pay Commission, said: “Recommending minimum wage rates in the midst of an economic crisis, coupled with a pandemic is a formidable task. The difficulty in looking forward even to next April is daunting.

“There are strong arguments concerning both low-paid workers – many performing critically important tasks – and the very real solvency risks to which small businesses are currently exposed. In these unprecedented conditions, stability and competence are prime requirements.”

According to the government, Commissioners did not believe the increase presents a significant additional risk to employment prospects, beyond the already challenging outlook.

The rise is lower than what was initial expected from the March 2020 Budget, with the Commission stating that it opted for a “prudent increase” which it will review in the years to come.

There has been no change recommended to the Government’s target of the National Living Wage reaching two-thirds of median earnings by 2024.

 

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https://i0.wp.com/thiis.co.uk/wp-content/uploads/2019/10/money-national-living-wage-comment-e1606315539461.jpg?fit=900%2C575&ssl=1https://i0.wp.com/thiis.co.uk/wp-content/uploads/2019/10/money-national-living-wage-comment-e1606315539461.jpg?resize=150%2C150&ssl=1Liane McIvorGovernment & Local AuthoritiesNewsroomRetailer NewsSector NewsSupplier NewsTrade Newsaccess,economic,employees,living,minimum,Mobility,review,Rishi,Spending,Sunak,wage,workersMobility and access companies can expect to pay a higher National Living Wage and National Minimum Wage rates from April 2021, confirmed the Chancellor in today's Spending Review. The National Living Wage (NLW) will increase by 2.2 per cent from £8.72 to £8.91, and will be extended to 23 and...News, views & products for mobility, access and independent living professionals