2020 is here and it is set to bring significant increases to the UK National Living Wage and National Minimum Wage.
From April 2020, the National Living Wage will stand at £8.72, an increase of 6.2%, while the National Minimum Wage for 21-24-year-olds will rise 6.5%, up to £8.20. Apprentices and those under the age of 21 will also see increases to their minimum hourly wage rates.
The rise in the National Living Wage is more than four times the rate of inflation, and has been described by the government as “the biggest cash increase ever”.
The new rates from April 2020 are as follows;
Announcing the policy on New Year’s Eve, Prime Minister Boris Johnson said: “For too long, people haven’t seen the pay rises they deserve.”
The rate increases will likely come as welcome news to millions of workers across the country, however, the news is less likely to welcomed by businesses. The Federation of Small Businesses (FSB) claimed that such a significant increase in wage rates may lead to businesses recruiting fewer people or even considering redundancies. The wage rates won’t be the only potential increase in costs for businesses, with business rates also set to rise by 1.7% in April.
The increases in wage rates were criticised by the TUC general secretary, Frances O’Grady for not going far enough;
“Workers are still not getting a fair share of the wealth they create, and in-work poverty is soaring as millions of families struggle to make ends meet.”
“No more excuses, working families need a £10 minimum wage now, not in four years’ time.”
The Labour Party had promised to introduce a real living wage of at least £10 an hour immediately whereas the Conservatives have instead pledged to raise the national living wage to £10.50 by 2024, but only “provided economic conditions allow”.