Today, National Living Wage has been brought into force within the UK and businesses are being urged to make sure they act on this new legal requirement to avoid heavy penalties.
A new compulsory minimum wage of £7.20 per hour has been brought into place today for anyone over the age of 25.
FSB chairman Mike Cherry continued: “Small businesses are playing their part by creating jobs and boosting pay packets wherever they can. Our research suggests that over half of small firms already pay their staff more than the voluntary Living Wage, but those that don’t are often operating in highly competitive sectors with very tight margins.
“While it is easy to say everyone deserves a pay rise, the only way to deliver and sustain higher wages in the long run is to improve productivity, boost skills and drive business growth.
“Without the right type of productivity growth, there is a real risk that in many sectors higher enforced statutory wages will lead to fewer jobs being created, fewer hours for existing staff and, unfortunately in some cases, job losses.”