The most obvious flaw with the Chancellor’s new “living wage” is that it is nothing of the sort. It might eventually get close to living up to its name at the promised £9.35 an hour by 2020 but in the meantime, while £7.20 is a significant improvement over old rate of £6.50, it is still little more than a rebrand that, anyway, only applies to those aged 24 and above. Not that is has stopped business from screaming blue murder, despite the reduction in the rate of corporate tax it has been handed to help meet the cost. The latest to join the chorus of complaint is JD Wetherspoon, whose founder and chairman Tim Martin has branded it a “capricious initiative” that “adds considerable uncertainty to future financial projections in the pub industry”.
Mr Martin was at pains to stress his company has done the decent thing by introducing a 5 per cent minimum starting-pay rise last October and agreeing an 8 per cent increase from 3 August this year, before the Government introduced its latest plans.
There are also sweeties such as shares, and bonuses to top things up. Of course, 5 per cent of not very much is, well, you know the drill. Mr Martin argues that staff costs make up a far bigger part of his overall overhead than they do for those evil supermarkets.
Isn’t it funny how they always seem to be trotted out whenever pub firms announce they are lowering profit forecasts, which Wetherspoon’s has just done. The complaint about the living wage is just a chaser to that rather sour pint. Mr Martin has a point when it comes to business rates and some of the other taxes imposed on pubs. But theirs will always be a premium product compared to what the supermarkets offer.
One of the things that might help persuade customers to visit their local Wetherspoon’s rather than staying at home with a four pack or two is if the staff make them friendly, welcoming. places. They’re more likely to do that if they are properly paid. Like the top three Wetherspoon’s executives, who’ve shared £3.8m over the past two years, are.Reuse content