Employers accused of cutting back perks to accommodate National Living Wage
Whether it’s increased overtime rates, discounts, food perks, or above average rates of pay, most employees enjoy a number of perks associated with their job role – but, following the introduction of the National Living Wage on April 1st 2016, many employees are now seeing these perks and benefits cut.
The National Living Wage, which provides a new minimum pay rate of £7.20 an hour for all employees aged over 25, was introduced in a bid to ensure that the lowest earners could afford to live (hence the name).
But, since the legislation was introduced, it has been reported that companies such as B&Q, Waitrose, and Café Nero are implementing changes to (or even abolishing) perks such as overtime, paid breaks, and food perks – leaving many thousands of low-paid workers significantly worse off.
Many of the companies involved, however, have stated that the cuts to payments and perks were not related to the increase in the national living wage. The John Lewis Partnership, for example, stated that they decided to scrap higher hourly rates for overtime and Sunday working from February 1st, in September 2015 before the new National Living Wage was even announced, after they realised that their competitors did not offer this payment perk.
However, following a discussion on the matter in Parliament, Chancellor George Osborne has warned companies who cut staff perks to compensate for the new minimum wage, that they should be mindful of the damage that will be caused to their reputation. He also advised that those companies who try to evade the new laws will face pressure from the government to rethink their policies.
But is this enough for those companies to change their approach to the National Living Wage?
CONTACT US TO FIND OUT HOW WE CAN HELP YOU SUCCESSFULLY MEET THE CHALLENGES OF THE NATIONAL LIVING WAGE. CALL 0844 324 5840 OR CONTACT US ONLINE.