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Increase in National Minimum Wage rates announced

January 15, 2020
Employment Law

The new Conservative government has recently announced significant increases to the applicable National MinimumWage rates.  With effect from April 2020, rates will increase as follows:

·      the NationalLiving Wage goes from £8.21 to £8.72

·      the rate for 21-24 years old goes from £7.70 to £8.20

·      the rate for 18-20 year olds goes from £6.15 to £6.45

·      the rate for 16-17 year olds goes from £4.35 to £4.55

·      the rate for apprentices goes from £3.90 to £4.15

The Tories are keen to trumpet the fact that the National Living Wage rate will increase by 6.2%; BorisJohnson claims that “hard work should always pay”. However, trade unions have been quick to assert that the increase is long overdue. Furthermore, the Living Wage Foundation calculates that the real ‘living wage’ in the UK is actually £9.30 per hour (or £10.75 inLondon). Meanwhile, some business groups have voiced concerns about their members’ ability to absorb such significant increases in labour costs.  

Good, bad or indifferent?

What do you think about these increases?  Are they good news?  Or are you worried about the risk of job losses if businesses struggle to meet the additional cost?

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