The new national living wage comes into effect from today, April 1st from when employers must pay their employees, who are over the age of 25, a minimum of £7.20 per hour.
The new minimum wage was announced by the government’s George Osborne last year and delivers a key part of the government’s plan to move towards a higher wage economy.
By 2020, the government aims to increase the National Living Wage to £9 per hour, affecting 1.9 million women and 1 million men who will see a rise in their pay.
From today, the National Living Wage will give around 900,000 women and half a million men an immediate pay rise in their hourly earnings of around £900 per year for a full-time worker.
The National Minimum wage for workers aged 21-24 remains at £6.70 an hour.
While this will be welcome for many lower-paid workers, it is likely to put a strain on some employers, most likely those within the hospitality, retail and care sectors.