Responses are divided as to the effect of NLW on pay differentials, with the same number (48.6%) saying pay differentials have been maintained as saying they have reduced More than three quarters of respondents (76.9%) report the NLW has had no effect on the total benefits package offered by their business An overwhelming 92.5% of respondents report that the NLW has had no effect on the age profile of the workforce 94.8% of respondents report that the introduction of NLW has not affected the number of workers employed below the age of 25 No respondents say that the increased apprentice rate has affected the number of apprentices they employ, with almost 44% saying they pay above the apprentice rate 41% of respondents state that the introduction of the Apprenticeship Levy has encouraged them to employ an apprentice More than 80% say they have no problems complying with the NMW or NLW Many respondents raised concerns about the impact the introduction of the NLW has had on salary sacrifice arrangements Though several respondents feel the introduction of the NLW has been a positive move, concerns have been raised about the reduced ability to reward staff for skills and experience Several respondents suggested the NLW rates should be based on abilities rather than age Whilst the introduction of the NLW does not seem to have had a significant impact on the number of actual jobs, it would appear that the number of hours worked has been affected, with 80% of respondents reporting an increase in the use of zero hours contracts. Whilst respondents say there has been no change in the age profile of their workforce as a result of the NLW being introduced, several respondents suggested that skills and experience rather than age should be a determining factor in the amount an individual is paid. Whilst the majority of respondents have not experienced any difficulties complying with the NMW or NLW, the impact NLW has on the ability of low paid workers to pay for benefits such as a pension through a salary sacrifice arrangement is a cause of concern for many. Conclusion
Recommendations
Creating a situation where the lowest paid workers are unable to benefit from the advantages afforded from paying for pension contributions or childcare through a salary sacrifice scheme appears to be counterproductive. The CIPP recommends that the Low Pay Commission approaches the government with a view to reviewing this situation.
The CIPP also suggests that the Low Pay Commission considers whether there are any other means of differentiating between NMW and NLW pay rates than simply the age of the worker.
The full survey results are available in the CIPP response to consultation for evidence on the National Minimum Wage .
Back to Contents
Higher National Minimum Wage for hours not guaranteed in a contract 31 July 2017
The Taylor report ‘ Good Work ’ recommends that the government should ask the Low Pay Commission (LPC) to advise on the impact of bringing in a higher National Minimum Wage for hours which are not guaranteed in a contract.
This recommendation forms part of the work to address the issue around zero or short-hours contracts where individuals are absorbing all of the risk. For many, not knowing when work would be offered, or whether they are entitled to statutory protections like sick pay or holiday pay mean they are unable to make informed choices. According to the report many of the people who attended the Review’s evidence sessions said they liked the flexibility of working atypically, so what is the solution?
The Chartered Institute of Payroll Professionals
Policy News Journal
cipp.org.uk
Page 286 of 516
Made with FlippingBook - Online magazine maker