The National Living Wage could rise from £9.50 this year to a maximum of £11.33 from April 2024, the Low Pay Commission has said.
This higher figure would represent a 19 per cent rise in two years – on top of the 6.6 per cent rise absorbed by employers in April.
In a review of the National Living Wage between 2015-20, the LPC notes that in residential and home care, 14.4 per cent of workers receive the NLW, which represents a 95 per cent increase since 2012.
In 2019, some 92,000 workers in these sectors received the NLW, equating to 5.7 per cent of all NLW recipients.
The review finds that the employers who paid less than the NLW to workers aged 21-24 years found it difficult to attract staff. However, there is some evidence that introducing the NLW did lead to increased use of zero-hours contracts. Social care employees are also said to be among the most likely to progress off the minimum wage.
Underpayment of social care workers is a long-standing concern at the LPC. In 2021, the Commission called for Government funding support for social care, after a report flagged up shoddy pay practices in social care. In 2016, the LPC warned that the NLW, if not matched by a commensurate increase in local authority fees, would have a negative impact on the sector and its workforce. It noted: “Non-compliance is mainly a function of broader funding and commissioning problems.’”
The LPC believes that the COVID-19 pandemic had left low-paid workers more vulnerable and businesses under greater pressure than ever before.