29 March 2017

With the National Living Wage and the National Minimum Wage rising on 1 April 2017, the NHBF is urging hair, beauty and barbering business owners to review whether they are paying staff at the correct rate.

From April 2016 to April 2017, hair salons, barbershops and beauty salons have faced the arrival of the National Living Wage for those aged 25 and over, two sharp rises in the National Minimum Wage rates, as well as a rise in the National Living Wage.

So many rises in a single year have put business owners under financial pressure, especially as the government has announced its intention to continue with rises to the National Living Wage, estimated to reach £9 per hour by 2020.

Public ‘naming and shaming’

However, employers who don’t pay at the right rates are breaking the law and face the consequences which include staggering fines of up to £20,000 per underpaid worker, as well as back-payments and public ‘naming and shaming’ by the government.

In February 2017, the government published the biggest ever ‘named and shamed’ list of 350 national minimum wage and national living wage offenders. 39 of the 350 businesses were from the hair and beauty sector, the highest number after hospitality and retail.

Because so many employers in the hair and beauty industry get it wrong, HMRC are specifically targeting salons and barbershops. Amid calls from MPs for more prosecutions, the first-ever Director of Labour Market Enforcement was appointed by the government in January, sending a strong signal that enforcement isn’t going away.

National Living Wage & National Minimum Wage rates

The 4.2% increase in the National Living Wage, along with rises in the National Minimum Wage hourly rates for those aged under 25 and apprentices looks like this:

Year 25 and over 21 to 24 18 to 20 Under 18 Apprentice
2016 £7.20 £6.95 £5.55 £4.00 £3.40
April 2017 £7.50 £7.05 £5.60 £4.05 £3.50

Action to be taken

The NHBF has emphasised the steps hair, beauty and barbering business owners should take immediately:

  • Check which staff will be eligible for the National Living Wage
  • Ensure staff under 25 are on the correct National Minimum Wage rate
  • Update payroll ASAP
  • Tell staff about any changes to their pay

Hair, beauty and barbering business owners can review whether staff are being paid the correct rate, by doing one of the following:

  • If you’re a member of the NHBF give one of the membership team a call on 01234 831965
  • Not a member visit www.livingwage.gov.uk
  • If you’re an employee, visit www.acas.org