As you will have possibly heard in the news, from the 1st of April 2016 the Government are introducing what they are calling the new “National Living Wage” (NLW) which is designed to replace the existing National Minimum Wage that has been in place since 1999 (when it was originally introduced at £3.60 per hour).
In April 2016, the NLW will be set at £7.20 per hour (the current rate is £6.50 per hour, increasing to £6.70 per hour in October 2015). The NLW will then increase annually so it reaches at least £9.00 per hour by April 2020.
Duncan Bullough commented – “As a company we view the new legislation as a massive positive. The new rules will lift basic pay rates by over 38% in a four year period and will bring salaries to a more acceptable level. The current situation, where the majority of cleaning contracts are awarded primarily on price alone, makes it impossible to significantly lift proposed pay rates without immediately pricing the company out of the work. The new rules I feel will suit companies like us who are able to innovate and improve both our rates of productivity and our methods of cleaning.
We all know the budget restrictions that have been placed on sectors such as education and there is little prospect of cleaning budgets being increased to cover the extra costs and so it will be up to companies like us to find ways of meeting the additional payroll costs, by reducing our own overheads and by finding ways of being more productive with increased use of modern machinery and more efficient cleaning techniques. There is no doubt that the current National Minimum Wage rate (£6.50/hr) is too low and the legislation is designed to address this and will make sure that all companies compete on a level playing field”