Nicky Jolley, founder and managing director of Darlington HR provider HR2day, is warning local businesses to consider the human cost, as well as the financial, in light of the increase in minimum wage earlier this month.
The government announced in November 2022, its plans to increase the National Living Wage, adding an extra 92p to hourly pay for people aged 23 and over, taking it from £9.50 to £10.42, representing an annual pay rise worth over £1,600 pounds to a full-time worker.
However, while businesses will need to be prepared for the impact of the increase on their bottom line, Nicky is also concerned about the impact this will have on workers who won’t be seeing a pay rise in the new financial year.
Nicky Jolley said: “Of course the increase of minimum wage is welcome in light of the cost-of-living crisis, however, it is crucial that businesses are ready for what it means to their staff. Inequality between colleagues is one the leading causes of workplace conflict. While those on minimum wage will benefit, employees on higher pay who are still feeling the pinch may feel aggrieved and potentially undervalued.
“Being well-prepared and having open and honest channels of communication with staff ensure the smooth transition of fiscal changes which is conducive to the running of a business, therefore maintains productivity resulting in happier employees meaning happier employers.
“Businesses need to consider carefully how they propose to deal with any conflict which may arise. Ensuring employees feel valued, are motivated, and rewarded equally is crucial, which can be difficult if financially it’s just not possible to give everyone a payrise.”