1. The National Living Wage
Kate Hindmarch, Partner and Head of Employment Unit
Aleks Tusien, Assistant Solicitor
28 June 2016
© Langleys Solicitors LLP 2015

2. What we will cover today
Background
The National Minimum Wage
The National Living Wage
What is it & who benefits from it?
How is it different to the “Living Wage”?
Cost to employers
Impact & future increases
Enforcement
Age Discrimination
© Langleys Solicitors LLP 2015

3. Background The National Minimum Wage What is it?
Who is entitled to it?
Who pays it?
© Langleys Solicitors LLP 2016

4. Background How much is the NMW? Category of Worker Pay
Standard Adult Rate (21 and over)
£6.70
Development Rate (18 – 21)
£5.30
Young workers Rate (under 18)
£3.87
Apprentices
£3.30
© Langleys Solicitors LLP 2016

5. Background Calculating whether the NMW has been paid Remuneration
Deductions
Working Time
BIS Guidance
Record-Keeping
© Langleys Solicitors LLP 2016

6. Background Claims by worker Other enforcement action:
Unlawful deductions from wages
Breach of contract
Detriment or unfair dismissal
Other enforcement action:
Civil action
Criminal offences
Naming and shaming
© Langleys Solicitors LLP 2016

7. The National Living Wage
Origin of the National Living Wage
Premium of 50p over the National Minimum Wage
Applied from 1 April 2016
© Langleys Solicitors LLP 2016

8. Cost to Employers Two main costs: Research / Recent Surveys
Cost of increase in pay itself
Cost of maintaining pay differentials
Research / Recent Surveys
How do employers afford the increase?
© Langleys Solicitors LLP 2016

9. Impact on Sectors Sector Predicted wage bill increase in 2016 (each)
Predicted wage bill increase by 2020 (each)
Retail
£3.8m
£25.6m
Healthcare
£2.5m
£14.3m
Hospitality and leisure
£2.2m
£13.2m
Transport and logistics
£0.6m
£9m
© Langleys Solicitors LLP 2016

10. Local Impact 2016 2020 City Share of Employees Directly Affected
Share of Employees Affected
York 7%
18%
12%
21%
Leeds 8%
20%
14%
26%
Sheffield 9%
22%
15%
28%
GB Average
23%
© Langleys Solicitors LLP 2016

11. Future Rate Increases Recommendations from the Low Pay Commission
rates for 2017 and 2018
report expected in October 2016
by 2020 will be over £9.00 per hour
© Langleys Solicitors LLP 2016

12. Enforcement
Same risk of claims by workers and enforcement action by HMRC if fail to pay the NLW
Additional measures announced by BIS in September 2015 (not yet in force)
Consultation by BIS and the Home Office in October 2015
© Langleys Solicitors LLP 2016

13. Age Discrimination Recruitment practices
Risk of direct and indirect age discrimination claims
Objective justification?
© Langleys Solicitors LLP 2016

14. Questions
© Langleys Solicitors LLP 2015

15. Employment Team Kate Hindmarch, Partner:
Phone No:
Aleksandra Tusien, Assistant Solicitor:
Phone No:  
James Barron, Assistant Solicitor:
Phone No:
© Langleys Solicitors LLP 2015