National Minimum Wage Increase & The Cost of Living Crisis
The Government has announced an increase in National Minimum Wage and National Living wage – but with the increasing pressure of the cost of living crisis, how can employers offer support to employees alongside adhering to wage increases.
What Are the New Rates?
The Government has announced changes to National Living Wage (NLW) and National Minimum Wage (NMW) coming into effect from April 2023.
From 1 April 2023 the following increases in rates will be introduced:
- 92p increase to the NLW for those aged 23 and over (from £9.50 – £10.42 per hour)
- £1, or 10.9% increase for those aged 21-22 (from £9.18 to £10.18 per hour). This increase is intended to narrow the gap with the NLW and put this age group on course to receive the full NLW by 2024
- 66p, or 9.7% increase for those aged 18-20 (from £6.63 to £7.49 per hour)
- 47p, or 9.7% increase for those aged 16-17 (from £4.81 to £5.28 per hour) and
- 47p increase in the apprentice rate (from £4.81 to £5.28 per hour)
Increasing Pressure
These latest changes will provide much-needed support for low-paid workers at a time when many are feeling increased pressure from a rising cost of living.
However, the current cost of living crisis is having a hugely negative impact on employee’s financial and mental wellbeing and for many can be a constant source of worry and stress that can cause distraction and dis-engagement at work.
What can you do, as employers, to support your employees when businesses are also feeling the pinch and inflation has reached a record high?
Lightening the Load – How Can You Help?
- Travel costs can be really expensive. Allow flexibility on working from home to minimise the travel costs for your employees. If you require them in the office full time are you able to consider contributing to the cost of travel, such as season ticket loans or bus passes?
- Ensure you get the payroll right and pay your employees on time. Any delays or errors could have a significant effect on your employee’s being able to budget their spending in the month and could result in them being charged by their banks if their accounts become overdrawn.
- Ensure employees are aware of any employee assistance programmes (EAP) you offer which could provide practical financial and emotional support confidentially.
- Provide links to financial or debt support that might be available – charities such as StepChange are a good resource.
- Ensure your benefits are up-to-date and in place, such as free eye tests, discounted food at local establishments close to the office, subsidised gym memberships or ability to sell annual leave if it is not used at the end of the year.
- You could provide fruit, drinks and snacks in the office to reduce the cost of bringing or buying lunch or make sure there are clean and well maintained fridges and microwaves are available so people can easily bring in food from home, which is often a cheaper option than having to go out and buy something.
- Review your family friendly policies and signpost parents to the Government’s 30 hours free childcare scheme and possible tax reductions if they are eligible.
By offering your employees a forum to talk about any concerns they may have it also provides a sense of support. If you have mental health first aiders they can be a good point of contact and will be able to signpost them to internal and external resources and will also keep an eye those employees who are potentially more vulnerable.
Even implementing a few of these ideas could make a real difference to your employees financial and emotional wellbeing and will give them the knowledge that you care and you are approachable if they need support.
