Minimum Wage: Clearing Up the Confusion
The cost of living is rising, fast. And site staff are feeling the pinch as much as anyone else in the UK supporting a family and watching the price of everyday essentials spiral.
Originally published on 30 March 2022, updated on 31 March 2023.
It will be of some comfort to lower paid workers – many of whom are working on site in residential and commercial buildings as concierges, porters, cleaners, caretakers and security personnel – that the National Minimum Wage and the National Living Wage have risen from 1 April 2023. It is obligatory for UK employers to comply with both, however the Real Living Wage and London Living Wage are voluntary.
It's all a little confusing, so below is a table which should help. We’re assuming you and your clients are not going to hire those under the age of 18 so these rates apply to adults.
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Statutory: Yes
How much was it: £6.83/hour
How much is it now: £7.49/hour
Who does it apply to: Those aged 18-20 inclusive
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Statutory: Yes
How much was it: £9.18/hour
How much is it now: £10.18/hour
Who does it apply to: 21 or 22
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Statutory: Yes
How much was it: £9.50/hour
How much is it now: £10.42/hour
Who does it apply to: 23 and above
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Statutory: No
How much was it: £9.90/hour
How much is it now: £10.90/hour across the UK, £11.95/hour in London
Who does it apply to: 18 and above
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Statutory: No
How much was it: £11.05/hour
How much is it now: £11.95/hour
Who does it apply to: 18 and above
Source: www.gov.uk/national-minimum-wage-rates and www.livingwage.org.uk
(The statutory rates are significantly lower for under 18s and apprenticeships).
So as of 1 April 2023, the majority of your on-site members of staff (those over 23) must be paid at least £10.42 per hour. That is about a 9.7% increase if they were earning the National Living Wage before.
Who sets the rates?
The UK government sets the statutory minimum wage rates and these are adjusted (upwards) annually. However, the living wage wages – of which there are two: one for London and one for everywhere else – are set by the Living Wage Foundation who say that their rates are the only ones “independently calculated based on rising living costs including fuel, energy, rent and food.”
What should you pay your on-site staff?
This is entirely up to you and your client, however at Cledor, we encourage our managing agent and landlord clients to pay at least the Real Living Wage/London Living Wage, primarily and fundamentally so our staff (YOUR on-site staff) are able to support their families. A small difference to your clients’ service charge could make a massive difference to them.
Unsurprisingly, we find that better paid site-based staff deliver a better service – more attentive, more engaged – and they are more loyal and will stay longer. They care more.
Isn’t that a price worth paying, especially when the staff salaries are shared between tens or hundreds of leaseholders, all of whom will benefit from a happier, productive and effective site team? We think so, and more and more organisations are committing to do the same.
One more thing… Not all personnel agencies treat their staff fairly
While you are your clients are budgeting for the total cost of staff supplied by an agency like Cledor, we would recommend you enquire how much the individual member of staff is earning – because it matters.