Are you going to pay your junior employees national minimum wage or real living wage?
Questions about national minimum wage, real living wage, salary and even whether to pay juniors at all can fill the mind of anyone looking to hire. It’s all a bit confusing.
We know that you want to pay your employees a fair, competitive wage while maximising your monthly budget. So the question of salary can be an awkward one, but it’s one we need to bring up.
The horrific year of 2020 came to an end with a bang for some big companies when the BBC published that some were seriously underpaying their staff. So it’s no wonder that you’re a tad confused, big companies like Tesco can’t figure it out either!
To protect yourself from being named and shamed in the underpaying employer hall of fame (the internet), read on.
The basics of pay
National minimum wage
The one you certainly know about is the national minimum wage. You were probably (and hopefully) paid this in your first job. It’s the legal basic you need to pay, so whatever your decision make sure it’s above the national minimum!
|Under 18||18 – 20||21 – 21||25+|
These rates tend to go up every year or so, so keep an eye on this article and on the news!
Fun fact: that £8.72 wage for over 25s is also known as national living wage. Not to be confused with…
Real living wage
The real living wage ignores the age of your employee and focuses on where they’re living.
It was created by The Living Wage Foundation and is voluntarily championed by business owners and job hunters across the country. It’s also championed by the team at DigitalGrads (we’re even an official living wage employer!)
This is because we believe that the national minimum wage isn’t enough. Living wage factors in things like housing cost, food and other basic expenses. It’s basically a more humane, fair hourly wage to help juniors focus on doing their best work.
No one wants to be worrying about going to the food bank in their lunch break.
When you pay your employees a living wage, they’ll be able to focus on doing their best work.
If you expect your new juniors to work in your London office, I would seriously recommend paying them the real living wage. The cost of renting a room in London – or even just in the commuter belt – is crazy.
When you pay the real living wage you also open yourself up to a more diverse group of people to employ. No one could live in London on national minimum wage without the help of their family. But some people have to help their families pay the bills.
If you’re looking to spend a bit more money to get a junior with some good experience, it’s worth it. And to keep an all-star hire on your team and not snatched up by someone else, it’s worth paying them a competitive wage to keep them happy.
The grass is always greener, so be sure to pay your employees well.
A simple salary calculator will tell you that if you pay your employee real living wage and they work full-time hours, they’re looking at £18,525 a year. So if you’re trying to calculate competitive pay for a valuable junior, consider shooting a little higher.
Legality vs reality
It all comes down to legality vs reality. Some employers would rather offer an unpaid internship than pay a liveable wage. But while you can sometimes skirt around the law when it comes to work experience, I would err on the side of caution.
Not only because you could be named and shamed by the BBC like Tesco, but because it’s just a decent thing to do. If you pay your employees like you value their time, they will probably like working for you a lot more!
But it all depends on circumstance. So whether national minimum or real living is the right wage for you and your employees, we hope you’ve now got the knowledge to write that job description and employ someone with confidence.