The ALMR, the leading voice for licensed retail hospitality, has welcomed the Government’s decision to accept the Low Pay Commission’s recommendations in determining the new rate of National Minimum Wage, rather than the previously discussed real terms increase to £7.
The Government has approved a rise in the adult rate of National Minimum Wage from £6.31 to £6.50 per hour. The rate for 18-20 year olds will rise to £5.13, the rate for 16-17 year olds will rise to £3.79 and the apprentice rate will increase to £2.73.
National Minimum Wage to £6.50
Responding to the news, ALMR Strategic Affairs Director, Kate Nicholls said: “The Government’s decision to accept the recommendations of the Low Pay Commission to increase the National Minimum Wage to £6.50 has shown a much-needed degree of restraint.
“The decision allows for an increase for employees and crucially avoids imposing additional, unsustainable costs on businesses across the UK. We are pleased to see the Commission acknowledge the pressures faced by low-paying sectors in its report and recognising the fact that smaller employers face tighter profit margins than large businesses. Margins across the licensed retailer sector remain tight and the increase in pay will push the margins of affordability for many pubs, clubs and restaurants.
“We saw wages in the hospitality sector rise by more than the CPI rate of inflation last year showing that, when affordable, the industry is prepared to invest in its staff. The moderation shown by the Government will ensure that hospitality businesses are still in a position to do so.
“We share the commission’s ambition to increase the rate, but above all we want to see a degree of flexibility and fairness for licensed retail. Accordingly, we are calling on the Government to take into account the totality of income and investment pubs, clubs and restaurants place in their staff and increased labour costs to ensure that salaries remain affordable.”