Risk of cuts to staff benefits on the back of the National Living Wage
In April 2015 the new National Living Wage came into force, increasing the national minimum hourly wage to £7.20 for all over-25s.
In the wake of this employers have been cutting benefits to staff such as free lunches and overtime pay rates. One such example of this ist B&Q, where nearly 140,000 people signed a petition against changes to Sunday and Bank Holiday pay cuts.
Cuts to benefits have also been proposed at Tesco, Caffe Nero and the John Lewis Partnership, and have similarly been opposed by workers.
The Office for Budget Responsibility has predicted that 60,000 jobs will be lost by 2020 as a direct result of the new National Living Wage.
George Osborne has warned companies against benefit cutting, calling it an "evasion of the spirit" of the new laws. Mr. Osborne has said that the Government will put pressure on those companies to live up to both their legal and moral obligations.
If you are an employee who has been or may be affected by proposed cuts to your current terms of employment, or are an employer concerned that there is a need to offset, the increase in your wage bill to ensure ongoing viability of your business, then please contact Alexandra Dean (firstname.lastname@example.org or on 01245 228141) who is a Partner at Gepp & Sons specialising in Employment Law.
This is not legal advice; it is intended to provide information of general interest about current legal issues.