The changes to the national minimum wage (now the national living wage), will affect people in different ways. Some people will win, others will lose, and some won’t be affected at all. Read on to find out more about how people will be impacted.

Workers Over-25

Minimum Wage - Watching the MoneyThe wage rise will only affect people who are over 25 years old. So, anyone who currently earns less than £7.20 an hour will now get a pay rise because of the new legislation. For many people who work in the retail industry, this will be a big boost for them. For example, someone over the age of 25 who previously earned the minimum wage will now earn 50p more for every hour. This might not seem like a huge sum of money. But when it is taken into account over the course of a year, it will provide the individual with a significant wage rise. So that’s who wins, but what about everyone else?

Workers Under-25

One of the major criticism levelled against this new policy is the way in which it excludes young people. With the many economic pressures and problems that young people are already facing, it might seem strange to not give them a pay raise. This is especially unfair when you consider that two people who do the same job might be paid differently purely because of their age. There are arguments for this kind of policy though. Many people hope that by not raising the minimum wage for young people, they will become more in demand. Youth unemployment is still higher than unemployment in older age groups. By making them cheaper to hire, it’s hoped that more young people will be hired.

Minimum Wage - Pound CoinsEmployers

Employers are going to be the ones that are paying for the wage rises that the new minimum wage will bring about. Many employer organisations and individual companies have complained about the changes. And many say that they will have to reduce their workforce to meet the new legislation. There is also the risk that they will look for ways to get around the costs involved. For example, the bosses at B&Q are in the process of imposing new contracts and cutting bonuses to offset the losses. There is a degree of hypocrisy in these complaints though. Recently Card Factory has been one of the most vocal in making clear the cuts, they are having to make to meet the wage demands. But then it was revealed that their profits rose by 25% in the last year. So people’s sympathy probably won’t be forthcoming.


People who work on a self-employed basis won’t be affected by the new legislation. That’s because they were never affected by the old minimum wage legislation either. There is a growing number of people who are classed as self-employed. The Citizen’s Advice Bureau has warned that 1 in 10 people who are classed as self-employed should be classed as full employees. There are tribunals involving a bike courier service that could challenge this bogus self-employment.

DISCLAIMER: These articles are for information only and should not be construed as advice. You should always seek advice prior to taking any action.