This year’s increase to the UK National Minimum Wage will put employers under pressure, says leading human resources specialist Breda Cullen from HR Team.
UK Chancellor Rishi Sunak has announced that the National Living Wage (minimum wage) will rise to £8.91 an hour from April 1, 2021. The age at which workers become entitled to the NLW also drops by two years to 23.
“While it’s welcome news for low-paid workers, the Budget increase will heap further pressure on employers in Northern Ireland and the UK . The need to maintain differentials across workforces is where the real pain will be for employers – many of whom are already facing difficult conditions post Brexit and the unprecedented affects of Covid-19.
Minimum wage increase April 2021
Ms Cullen adds that the move, which will take effect from April 2021, raises concerns over increased costs to already under pressure businesses. And employers will “feel the pinch” as they navigate the repercussions from the fallout of the pandemic, she explains.
“The increased minimum wage may force some employers to reduce employee’s working hour, particularly in sectors which have large numbers of low-paid and casual workers such as retail and hospitality.”
“The increase will also be particularly difficult for small businesses which have no potential to pass on such cost increases,” says the employment law specialist.
The full breakdown of the minimum wage increase by age bracket is as follows:
- Workers aged 23 and over: £8.91 an hour (National Living Wage)
- Workers aged 21-22: £8.36 an hour
- Development rate for workers aged 18-20: £6.56 an hour
- Young workers rate for workers aged 16-17: £4.62 an hour
- Apprentice rate: £4.30 an hour