Pay rises is the latest talking points after the Bank of England Governor warned workers not to ask for significant pay rises as part of tackling high inflation.
With many employees feeling the pinch due to the increasing cost of living, employers could nevertheless find themselves thinking about pay rises, whether in response to a request or otherwise. So, what can it be helpful for employers to know?
1. Check your contracts of employment
Some organisations give employees a contractual right to a pay rise or a pay review, so it’s important to check your contracts of employment to identify whether your organisation is one of these.
If there is a contractual right to a pay review, in most cases, the entitlement is just that – the right to have pay looked at, whether there will be any increase will usually be at the discretion of the employer.
If there is a contractual right to a pay rise, it’s important to identify when this is due and to ensure that appropriate steps are taken in good time e.g confirming this to employees and ensuring that the correct notifications are made internally, such as informing payroll.
If you are unsure as to whether employees in your organisation may have an entitlement to a pay rise, please contact us for advice on your situation.
2. National Minimum Wage rises ahead
It’s important to remember that if any employees are paid at the National Minimum Wage rates, they will be in line for a mandatory pay rise when the rates are increased in April. Don’t forget that it’s not just those employees who are paid at the National Minimum wage rate who may benefit from the increase, employers should also review the pay of those who are paid just above the current rates to ensure they receive at least the new National Minimum Wage rates once they are in force.
Information on the new National Minimum Wage rates can be found in our earlier Legal Update here
3. Requests for a pay rise
If an employee makes a general request for a pay rise, in the absence of a right to one, it will be for the employer to consider whether to grant it or not. When it comes to pay and pay rises generally it’s important to ensure that all employees are treated fairly, in a non-discriminatory way and that employers are careful to avoid equal pay issues in the organisation.
If you receive a request for a pay rise from an employee or a complaint about wages, such as an underpayment, please contact Kingfisher Professional Services Ltd for advice on the facts of your case.
If you have an employment law matter you would like assistance with, please do not hesitate to contact us as we are happy to help.