7 December 2015 | Herpreet Kaur Grewal
Nearly half of UK companies are not yet geared up for the new National Living Wage (NLW).
Only around 45 per cent of firms surveyed have updated payrolls to take account of staff aged 25 and over on 1 April 2016 - when the national living wage becomes law.
The finding comes in a survey conducted for the Department for Business, Innovation, and Skills (BIS) asking 1,000 employers across Britain about the NLW.
Just 39 per cent had communicated the forthcoming changes to staff, and only 29 per cent had looked online for more information about NLW entitlement.
The poll reveals that 93 per cent of bosses agree the new wage is a good idea, with 88 per cent believing that it will lead to higher productivity and 83 per cent saying it will make staff more loyal to their companies. When asked if they thought the new rate would be good for businesses, many respondents identify a range of positive impacts:
- 93 per cent of all bosses agree the National Living Wage is a good idea;
- 88 per cent say it will make staff more productive;
- 83 per cent believe it will make staff more loyal towards their employer;
- 86 per cent say it will boost staff morale; and
- 82 per cent believe that customers are likely to return if the business pays the right rates of pay.
This comes despite only 63 per cent of bosses saying they knew who in their business should be getting the new NLW.
Britain's bosses are urged to take four simple steps now to be better prepared for its introduction:
- To know the correct rate of pay - £7.20 an hour for staff aged 25 and over;
- To find out which staff are eligible for the new rate;
- To update the company payroll in time for 1 April 2016; and
- To communicate these changes to staff as soon as possible.
Business minister Nick Boles said: "I am urging businesses to get ready now to pay the new £7.20 rate from 1 April 2016. With just under four months left, there are some easy steps employers can take to make sure they are ready. By taking these measures, companies will be able to properly reward their staff and avoid falling foul of the law when it takes effect."
The NLW is a key part of the government's plan to continue to move to a higher wage, lower tax and lower welfare society, building a more productive Britain and giving families the security of well-paid work.
Employers can find out more by visiting www.livingwage.gov.uk.