The UK’s National Living Wage (NLW) has come into force, giving over 300,000 retail workers an immediate pay rise and costing retailers £3 billion by 2020.

However, the British Retail Consortium has said that the actual costs are likely to be reduced by a narrowing of the differentials in pay for performance, the reduction of premium payments and consolidation of benefits into pay.
Under the scheme, workers aged 25 and over will be entitled to at least £7.20 an hour, whilst workers aged 21 to 24 will continue to be entitled to the National Minimum Wage of £6.70 an hour.

Over a fifth of all workers impacted by the change work in retail and, together with the hospitality industry, the retail industry accounts for nearly half of all workers on the lowest pay.

The move will make the UK’s minimum wage one of the highest of all the developed countries, according to the Financial Times.