National Living Wage comes into force

[Zaune]

BBC News

The new mandatory National Living Wage (NLW) has come into force, requiring employers to pay workers aged 25 and over at least £7.20 an hour.

It is expected to give 1.8 million workers an immediate pay rise.

The policy was announced in last summer's Budget by Chancellor George Osborne, in an effort to create a higher-wage, lower-welfare economy.

Workers aged 21 to 24 will continue to be paid the National Minimum Wage of £6.70 an hour.

Some 1.3 million workers are paid the minimum wage, while another 500,000 who earn slightly more than the current £6.70 an hour will also benefit.

Adam Sowter, a hotel employee in York, told BBC Breakfast the extra money would help him pursue his ambition of becoming an actor.

However, his colleague Clare Vernon will be about £1,000 worse off over the next 12 months, because she is under 25. "We do the same amount of work," she said.

"The hours are really unsociable, so me getting 50p an hour less to work until 03:00 can get a bit annoying - I've only got another four years to wait."

The intention is for the NLW to rise to more than £9 an hour by 2020.

However, there are fears of job losses as companies struggle to pay the new higher wages.

The independent Office for Budget Responsibility has warned that 60,000 jobs could go as a result.

Sir George Bain, former chair of the Low Pay Commission, dismissed fears that the NLW could cost jobs.

"I think the claims are overblown, but I think it is too complicated to call in advance," he told Radio 4's Today programme.

The Living Wage Foundation, which inspired the idea but does not set the level of the NLW, welcomed its introduction, but urged businesses to "aim higher" and pay more than the statutory minimum.

Some employers have already pledged to do this.

'Good news'

The TUC said the government needed to ensure that everyone benefited from the NLW.

"Britain desperately needs a pay rise, and this increase is good news for those aged 25 or older," said TUC general secretary Frances O'Grady.

"But the government must ensure that younger workers are not left behind; 21 to 24-year-olds will not be seeing an increase.

"This is not fair. Future wage increases must narrow the pay gap between old and young."

For its part, the Living Wage Foundation pointed out that its own suggested level of pay - £8.25 an hour and £9.40 in London - was higher than the NLW.

"The job is not done when it comes to tackling low pay," said the foundation's director, Katherine Chapman.

"Businesses who can afford to pay a rate that reflects the real cost of living should do so and join over 2,300 employers signed up to pay our higher voluntary Living Wage.

"For profitable business or those who see themselves as innovators and leaders, simply not breaking the law on pay is not enough. Many businesses want to aim higher."

'Huge effect'

Paul Johnson, director of the Institute for Fiscal Studies, told Radio 5 live: "This is going to have, in the longer run, a huge effect on the British labour market, because it's going to affect such a large fraction of workers."

The NLW will also have a bigger impact in regions such as the North, North East and the South West than in London. "It will have a ripple effect up the earnings distribution, because you will be taking the lowest-paid up to a level close to, or in some cases above, the next rung or two up the ladder."

I don't say this often, but... Good on the Tories. I'd rather it was applicable to everyone over 18, but I can't deny it's a step in the right direction.

[Eternal_Freedom]

I second that, though I suspect it's a similar situation with raising the retirement age, it needs to be done but it's not something that be done drastically all at once.

[madd0ct0r]

Will this result in younger people getting an advantage when applying for shitty jobs?

[Eternal_Freedom]

Probably yes.

[Zaune]

Will this result in younger people getting an advantage when applying for shitty jobs?

Even if it does, it's not like rent, bills and food cost less if you're under 25.

[Flagg]

Kinda bullshit for the tiered age thing. Then again, it may encourage people to have children at an older age, thus being more mature from the get-go and having the money to more successfully raise children. Assuming the Tories are for family planning (I honestly don't know if they are or not, but I assume they probably are since even the righties in the UK are more centrist compared to the US) that is. If not, it just makes the tiered shit more egregious.

I mean we do that in the US, but only for kids between 14 (when you can legally enter the workforce in most states) and 18. That also comes with restrictions on the hours that can be worked each day.

[JamesStaley]

Okay, you guys are talking "Pounds", so i'm assuming this is an artile from Britian/Europe, but the principal is the same everywhere. As an American "Wage Slave" myself, but someone who also has been a boss-employer and is a FIRM believer in the Capitalist/Free Enterprise system, I can & have seen it from both ends.
Speaking for myself, I do not want to see that kind of thing implymented in the United States. It would do more harm that good: it always does! Let the Free Market system determine what people should be paid, and living conditions/economic conditions WILL improve.

[TheFeniX]

Speaking for myself, I do not want to see that kind of thing implymented in the United States. It would do more harm that good: it always does! Let the Free Market system determine what people should be paid, and living conditions/economic conditions WILL improve.

I know, right. Free market. Works for Walmart and only costs taxpayers $6 billion a year. Walmart share-holders make bank and the rest of us pick up the tab: FREE MARKET!

[Esquire]

Okay, you guys are talking "Pounds", so i'm assuming this is an artile from Britian/Europe, but the principal is the same everywhere. As an American "Wage Slave" myself, but someone who also has been a boss-employer and is a FIRM believer in the Capitalist/Free Enterprise system, I can & have seen it from both ends.
Speaking for myself, I do not want to see that kind of thing implymented in the United States. It would do more harm that good: it always does! Let the Free Market system determine what people should be paid, and living conditions/economic conditions WILL improve.

That is objectively not true. The only period of truly unregulated capitalism we've experienced so far saw effectively-forced child labor, unimaginably horrific working conditions, and the resulting tens of thousands of crippling injuries. Unregulated capitalism optimizes for profit to corporate bodies*, not anything particularly amenable to human life.

*As always, correlation =/= causation; any individual business owner may be a perfectly pleasant human being. On balance this is not true, with the above results.

[Simon_Jester]

Will this result in younger people getting an advantage when applying for shitty jobs?

Even if it does, it's not like rent, bills and food cost less if you're under 25.

People under twenty-five are less likely to have dependents.

I don't really think that justifies the age discrimination, but it's a very real issue. You're a lot less likely to find (for example) 24-year-old women with a chronically ill and underemployed husband plus two children than you are to find 44-year-old women in the same position.

[Zaune]

You'd be surprised how many of my contemporaries were having kids when I was starting college. And in any case, the current minimum wage in this country is pushing it a bit even for a single adult with no dependents; you can just about get by from day to day in most parts of the country if you can find a decent one-bedroom apartment or a house-share with people you can get along with, but good luck putting anything into a pension fund or saving for a deposit on a house.

[Simon_Jester]

Acknowledged, and I'd definitely favor extending the wage increases to people in the 18-25 age bracket.

At the same time, though, "I'm not putting savings in my pension fund at 23" is not a complaint of the same order as "I can't put an adequate roof over my children's heads."

[JamesStaley]

The right to a safe workplace is NOT mutually-exclusive or opposed to Free Enterprise! As a rule of thumb, I DETEST government sticking its ugly nose into my business, but one government agency I do (Kinda) support is OSHA, the Office of Safety & Health Administration, because their job is to keep me safe at work (and they're not trying to TOTALLY control every aspect of my life!). Of course you have to have SOME laws, rules, regulations; otherwise you have anarchy and "Poor Enterrpise".

For "The FeniX". You're mad at Walmart (or Walmart EX's) for being dishonest, making a ton of money and cheating people, right? So how does setting the minimum wage you can pay the little guys at the bottom, HURT/STOP/PREVENT the guys at the top from making out like the bandits they are? It doesn't.

A "minimum wage" job will ALWAYS be JUST THAT, no matter what that wage is. If you make the minimum wage $50.oo dollars an hour at Burger King, You are STILL working a minium wage job at Burger King!

i've always wanted to comment on this about the minimum wage: I find it interesting that the people at the top who set the minimum wage, ARE THE PEOPLE WHO ARE NOT WORKING FOR IT OR TRYING TO MAKE A LIVING ON IT!!

[Gandalf]

The right to a safe workplace is NOT mutually-exclusive or opposed to Free Enterprise! As a rule of thumb, I DETEST government sticking its ugly nose into my business, but one government agency I do (Kinda) support is OSHA, the Office of Safety & Health Administration, because their job is to keep me safe at work (and they're not trying to TOTALLY control every aspect of my life!). Of course you have to have SOME laws, rules, regulations; otherwise you have anarchy and "Poor Enterprise".

So why not let the Glorious Free Market decide issues of OHS? Surely the purity of capitalism means that those who treat their workers better through safety as well as wages will be rewarded by the Righteous Invisible Hand?

[TheFeniX]

but one government agency I do (Kinda) support is OSHA, the Office of Safety & Health Administration, because their job is to keep me safe at work (and they're not trying to TOTALLY control every aspect of my life!)

Believing OSHA doesn't control every aspect of your life makes me wonder if you perform any job with manual or assisted labor. Got a 500 foot extension cable with one nick in the insulation? Throw it out. Oh wait, you didn't and it failed: you're liable. Got a crack in your hand-drill? Toss it. Your $500 nomex got a small rip in the arm-pit? Toss it.

HAZWOPER alone covers a huge range of dangerous conditions and all that training and PPE costs money. Without a goverment backed system like OSHA, business would just do what they did around the turn of the 20th century: "Bob got sick from inhalation we didn't protect him from? If he doesn't come in, fire him and hire someone else."

Shit like this exist because people were fucking dieing. Like... a lot of people that just didn't need to die for stupid shit.

FREE MARKET!

For "The FeniX". You're mad at Walmart (or Walmart EX's) for being dishonest, making a ton of money and cheating people, right? So how does setting the minimum wage you can pay the little guys at the bottom, HURT/STOP/PREVENT the guys at the top from making out like the bandits they are? It doesn't.

If Walmart was required to pay people what they need for basic living expenses, that $6 billion would be passed off to Walmart and be paid for out of their pockets. Maybe they'd fire a bunch of people, who knows? But they benefit as a company a Hell of a lot through Big Bad LIBERAL Government Programs.™

A "minimum wage" job will ALWAYS be JUST THAT, no matter what that wage is. If you make the minimum wage $50.oo dollars an hour at Burger King, You are STILL working a minium wage job at Burger King!

I've heard this before and it meant as little then as it means now. There's nothing wrong with being poor. There is something wrong with working a full time job, in a first-world country, and not being able to eat and keep a roof over your head. The "free market" Gods have never done anything to fix that. Historically, they just fucking CRUSH anyone who complains, work to death those who don't, then replace the broken with the next wave of new hires. And they'll use anyone for it. You think child-labor laws came out of a vacuum?

i've always wanted to comment on this about the minimum wage: I find it interesting that the people at the top who set the minimum wage, ARE THE PEOPLE WHO ARE NOT WORKING FOR IT OR TRYING TO MAKE A LIVING ON IT!!

Yea, because people with no money have all the means to start a political movement. Further, working 2+ jobs leaves LOADS of time to get involved in politics. Damn, I feel like we should consider selecting a bunch of people, through some kind of popularity contest, to handle stuff like this.

[Guardsman Bass]

A "minimum wage" job will ALWAYS be JUST THAT, no matter what that wage is. If you make the minimum wage $50.oo dollars an hour at Burger King, You are STILL working a minium wage job at Burger King!

I don't understand your criticism here. Of course it's still a minimum, but setting it a bit higher means it can be better minimum - preferably high enough so that it reduces poverty and encourages more labor productivity, but not so high that it has major effects on employment and prices.

There's a moral argument here as well, namely that the government should include as a requirement for business that you pay full-time employees enough so they can meet some socially acceptable minimum standard of living. That's especially since societies (particularly the US) tend to explicitly promote working a 40-hour week as the key to prosperity - if it doesn't do that, then something's wrong with your economy.

[whackadoodle]

<<This applies to the U.S. only. I really don't know how minimum wage and public assistance works in other countries.>>
Go to any Wal-Mart. Or McDonald's. Or any place where starting pay is within a dollar or so of the federal minimum wage. Look around for employees. Done? Good. Half of everyone you saw is on some form of public assisatnce. SNAP, WIC, Medicaid, whatever. All programs that are paid from public coffers, i.e. your wallet. $152 Billion a year, to people who have jobs.

We are subsidizing the payrolls of some of the largest corporations in the world.

Privatized profits, socialized costs.

That alone should have all Americans, left or right, howling to raise the minimum wage to a living wage.

[TheFeniX]

Free Market types seem to think that if people are paid more money, it's a net loss no matter what. As if these people are just going to sit on their money, never spending it, even though if they were paid enough: they'd get kicked off government assistance. I know it's crazy, but it might just be in the realm of possibility that if, say, Wal-Mart increased it's employee pay, those same employees might spend that money at the store they work at based on convenience. If they have more money for food, why not spend it before you leave for the day and save yourself a trip? If you've got some extra money after the fact, why not take advantage and pickup a TV? Toys for the kids? Some lightbulbs? Whatever.

This obviously does not apply across all minimum wage payers, but the idea that paying your employees more is always a net loss is idiotic.

[whackadoodle]

Free Market types seem to think that if people are paid more money, it's a net loss no matter what. As if these people are just going to sit on their money, never spending it, even though if they were paid enough: they'd get kicked off government assistance. I know it's crazy, but it might just be in the realm of possibility that if, say, Wal-Mart increased it's employee pay, those same employees might spend that money at the store they work at based on convenience. If they have more money for food, why not spend it before you leave for the day and save yourself a trip? If you've got some extra money after the fact, why not take advantage and pickup a TV? Toys for the kids? Some lightbulbs? Whatever.

This obviously does not apply across all minimum wage payers, but the idea that paying your employees more is always a net loss is idiotic.

See my above post. Yeah, Wal-Mart employees are going to take advantage of their employee discounts, but they are going to do so whether the money comes entirely from their employer or from their employer + welfare. Look at it from Wal-Mart's point of view: if it is a choice between simply recapturing payroll money, or recapturing payroll money and capturing other peoples money by underpaying your employees, well... It's a no-brainer. By fucking their employees, they get to underpay them, and capture some tax dollars to boot. Win-Win, man.

No wonder they lobby so hard against the minimum wage.

[TheFeniX]

No wonder they lobby so hard against the minimum wage.

And they also lobby, alongside some manufacturers, for expansion of Food Stamp programs. A noble idea marred by the issues you bring up. I've read elsewhere that Walmart spends around $6 Billion a year lobbying congress and other Federal, State, and Local governments. And they spread out as many contributions as they can to every campaign, no matter their affiliation.

Who the fuck can compete with shit like that? People working 80 hours a week and not making enough to pay all the bills? People who work for a company that has the means to shut down an entire store if they even get a whiff of the word "union?"

[Guardsman Bass]

Walmart doesn't lobby hard against minimum wage increases, at least not when they apply to all stores in an area (they do lobby against minimum wage increases that target big box stores specifically).

Also, can we stop the "subsidizing Walmart" claim? Walmart would not be paying their employees more if these programs didn't exist.

[Elheru Aran]

Walmart doesn't lobby hard against minimum wage increases, at least not when they apply to all stores in an area (they do lobby against minimum wage increases that target big box stores specifically).

Also, can we stop the "subsidizing Walmart" claim? Walmart would not be paying their employees more if these programs didn't exist.

Can you argue that Walmart *doesn't* derive a net benefit from their employees being on public assistance, though? Namely, that their employees now have more money that they will probably spend at Walmart, that Walmart didn't have to pay them?

[Esquire]

You're looking at this backwards. The idea isn't to punish Walmart, fun though that would be; the idea is to raise the living standards of their employees. That can't be done [at an acceptable cost] by reducing welfare programs.

[Guardsman Bass]

Walmart doesn't lobby hard against minimum wage increases, at least not when they apply to all stores in an area (they do lobby against minimum wage increases that target big box stores specifically).

Also, can we stop the "subsidizing Walmart" claim? Walmart would not be paying their employees more if these programs didn't exist.

Can you argue that Walmart *doesn't* derive a net benefit from their employees being on public assistance, though? Namely, that their employees now have more money that they will probably spend at Walmart, that Walmart didn't have to pay them?

"Subsidy" implies that Walmart would pay them more if it weren't for these programs, which I don't think is true. Walmart benefits from low-income folks having more buying power from these programs, but so does everybody else selling stuff to them.

[TheFeniX]

"Subsidy" implies that Walmart would pay them more if it weren't for these programs, which I don't think is true. Walmart benefits from low-income folks having more buying power from these programs, but so does everybody else selling stuff to them.

Yes, everyone benefits except the taxpayer. And a business like Walmart, the largest business employer in the world IIRC, certainly does need that kind of help. That's the point: The Waldens are just as much welfare queens as the most rabid of conservative likes to use as an example of why the programs are garbage.

No one is arguing that welfare programs are bad. No one is saying they should be removed. But if Walmart couldn't lean on them, and even offer assistance on how to apply for them: they'd be forced to do something. If we let the "Free Market" handle what they do, they'd probably just let people starve, then just deal with a revolving door style of employment as their turn-over rate skyrocketed. Much like we expect the food services system to rely on young workers with other safety nets. We consider these jobs unskilled and not important but bring the fucking rain if I can't get a cheeseburger in under 30 seconds of waiting.

If WalMart was forced to pay it's workers a living wage, they might just fire a whole shitload of people. So, I don't know if it's the best idea. But the current working system is bullshit. Walmart gets to pocket billions while selling certain goods for cheap. The Free Market would say it's because they are shrewd businesspeople (they are actually) that got this all on their own. But in reality, everyone else picks up the tab for their thuggery.

And the "buying power" people get from taxpayer money usually goes to fucking WalMart anyways because the poorer you are the more likely you are to have to shop there because their prices in those areas are usually the best. They benefit both ways. So, my heart is really bleeding for them.