Employers Planning Redundancies to Cope With Introduction of the National Living Wage

blog-publish-date

10 May 2012

blog-read-duration

  A fifth of UK bosses are planning to make employees redundant in order to accommodate the introduction of the National Living Wage (NLW), according to HR experts, Croner. The research carried out in March this year by Croner’s pay and benefits specialists also reveals that 20% will be using more self-employed workers as opposed to employing people directly. However only 10% of businesses said the legislation would affect their recruitment plans. A third of businesses replying to the survey said that the NLW will have a negative impact on their business, with many of them already seeing an increase in wage and supplier costs. Viv Copeland, Head of Reward at Croner says: “The introduction of the National Living Wage has without doubt been one of the biggest game changers in recent employment history. It is estimated that around six million workers will benefit from the new legislation which is good news for them, but we wanted to know what impact this will have on employers which is why we carried out the research. “The biggest challenge emerging from this research is how employers will fund the wage increases, especially where the costs cannot be passed on to customers. This is particularly an issue in the care sector, who admitted they would have to make redundancies in order to cope with the rise in wage costs. “On a positive note 60% of respondents said they would be reviewing their overall pay and grading structures to ensure that relative pay remains fair and differences justified.” The research features in Croner’s latest briefing: The National Living Wage Research into Strategies. The briefing also highlights practical ideas for coping with the rise, including changing pay reference periods and managing poor performance.

Free to Download Employer Resources

  • Model Apprenticeship Agreement

    FREE DOWNLOAD

    Model Apprenticeship Agreement

    Read more
  • Sample COSHH Assessment Record

    FREE DOWNLOAD

    Sample COSHH Assessment Record

    Read more
  • Return to Work Interview Form

    FREE DOWNLOAD

    Return to Work Interview Form

    Read more
  • BLOG

    Preparing for a No-Deal Brexit

    A no-deal Brexit is now illegal—sort of. The latest piece of legislation passed ...

    Read more
  • Paid Suspension from Work

    BLOG

    Paid Suspension from Work

    Suspension is often seen as a punishment or disciplinary sanction—this isn’t the...

    Read more
  • BLOG

    Conditional Job Offers

    The job process can be a long-winded one for all involved. From creating the job...

    Read more
  • Syalons

    CASE STUDY

    Syalons

    International Syalons is a manufacturer of advanced ceramics, working for variou...

    Read more
  • Pangea Support

    CASE STUDY

    Pangea Support

    We see Croner being integral to our organisation moving forward, and we’d defini

    Read more
  • JC Couriers

    CASE STUDY

    JC Couriers

    With Croner it genuinely feels like they want me to be a success. And I'm happy

    Read more

Do you have any questions?

Get a free callback from one of our regional experts today