Tag: minimum wage

The retailer is on track to open another 1,000 stores

Lidl has announced a pay increase from next year and according to the supermarket chain, the rise in wage will make it the highest paying supermarket in the UK. The supermarket said higher rates will apply to the capital’s workforce. Lidl commented that “entry-level wages will increase from £9.50 to £10.10 an hour outside of London and £10.85 to £11.30 within the M25 from March 2022, with colleagues earning up to £11.40 and £12.25 respectively, depending on length of service.”

The increase represents a pay rise of more than 6% for some and this will benefit more than 80% of its staff. By comparison, the UK’s minimum wage for workers over 23 is set to rise from its current level of £8.91 an hour to £9.50 from April 2022.

It stated that the increase recognised “the hard work and dedication of frontline colleagues during the last 18 months of the pandemic.”

It comes after continued staff shortages in a market where employers are continuing to struggle to fill roles, affecting the hospitality and retail sectors.

Lidl is expanding and currently has more than 850 stores in Great Britain. According to reports it says it’s still on track to increase that to 1,000 by the end of 2023.

Nan Gibson, Lidl’s chief HR officer, commented to the BBC: “We do not expect to pass that on to customers in the form of price rises.” She said it was currently “very difficult” to recruit staff, adding: “We are competing for talent with all the other retailers and, indeed, other industries.”

Ms Gibson said Lidl’s pay rise was intended to retain existing staff “as far as possible”, but also to attract new workers.

Christian Härtnagel, chief executive at Lidl GB, said: “We have ambitious plans to grow our business across Great Britain, and to do that, we need to ensure we attract and look after the best talent at every level of our business.”

 

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Too many workers have no access to supported training

Chancellor Rishi Sunak confirmed a rise in the National Minimum Wage (NMW) in the autumn budget this week. While the increase was expected, it presents a “double whammy” for employers who are facing this increase at the same next year as the rise in National Insurance.

Richard Maitland, partner at MHA, says the rise is in line with previous annual increases: “The size of the increase to the top rate – the National Living Wage (NLW) – is also around the level we saw prior to the pandemic, although there was a ‘COVID-19 blip’ for the current year when the increase was much smaller.

“To be precise, the increase from April 2020, which had been agreed pre-pandemic, was £0.51 (an hour) and this current proposed increase (April 2022) is £0.59. The rise from April 2021 which did factor in the effect of the pandemic was unusually low, at just £0.19, although at the same time the NLW was extended to 23- and 24-year-olds, whereas previously only those aged 25 and over had been entitled to it.

“For minimum wage employers in sectors such as hospitality, who are very much still feeling the financial pressures of COVID-19, a further increase to their employment costs will be far from welcome.”

An REC spokesperson commented as well: “This rise is a return to the aim of raising the Minimum Wage to two thirds of median average wages by 2024, after a pandemic-inspired slowdown last year. In deciding the rate can get back on path in one year rather than two, the LPC has concluded that the strong pay growth suggested by REC surveys will persist – though this will put pressure on sectors like care and hospitality. The big unanswered question is about progression from lower-paid roles – too many workers are locked out of supported training by the inflexibility of the apprenticeship levy. We need a reformed model, where temporary and flexible workers can do shorter bursts of training that reflect labour market needs and raise their pay.”

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In the last year, HMRC assisted more than 155,000 workers across the UK recover more than £16m in wages owed to them. They also issued more than £14m in fines to businesses who did not comply with minimum wage requirements.

Whilst most employers do pay their staff the National Minimum Wage,  HMRC has revealed some of the most ridiculous excuses for businesses not paying the legal minimum:

1. “She does not deserve the National Minimum Wage because she only makes the teas and sweeps the floors.”

2. “The employee was not a good worker, so I did not think they deserved to be paid the National Minimum Wage.”
3. “My accountant and I speak a different language – he does not understand me, and that is why he does not pay my workers the correct wages.”
4. “My employee is still learning so they are not entitled to the National Minimum Wage.”
5. “It is part of UK culture not to pay young workers for the first three months as they have to prove their ‘worth’ first.”
6. “The National Minimum Wage does not apply to my business.”
7. “I have got an agreement with my workers that I will not pay them the National Minimum Wage; they understand, and they even signed a contract to this effect.”
8. “I thought it was okay to pay young workers below the National Minimum Wage as they are not British and therefore do not have the right to be paid it.”
9. “My workers like to think of themselves as being self-employed and the National Minimum Wage does not apply to people who work for themselves.”
10. “My workers are often just on standby when there are no customers in the shop; I only pay them for when they are actually serving someone.”
Steve Timewell, Director Individuals and Small Business Compliance, HMRC, said: “This list shows some of the excuses provided to our enforcement officers by less scrupulous businesses. Being underpaid is no joke for workers, so we always apply the law and take action. Workers cannot be asked or told to sign-away their rights. We are making sure that workers are being paid what they are entitled to and, as the economy reopens, reminding employers of the rules and the help that is available to them.”
Photo courtesy of Unsplash.com
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