You’d be hard pushed to find many people who disagree with the intentions behind the National Minimum Wage. Everyone deserves to earn a living wage, and, as a society, we need to make work a more attractive proposition than not working.

However, for many businesses, it’s clearly going to create issues. Estimates show that it will affect 1.7m employees, and cost businesses over a billion pounds annually.

It is also expected that the NMW will affect different towns to varying degrees. Hull, for example, is predicted to be one of the most affected areas, with 31% of workers receiving more wages as a result.

The penalties for those that pay below the minimum wage can be significant – and the Government has, in recent times, taking to naming and shaming those that don’t.

But the costs are going to increase and the entertainment and hospitality industries are going to be hit especially hard. Frequently employing young staff on a temporary or part-time basis, owners of bars, hotels, pubs and clubs will be amongst the worst affected.

Simply put, the onus will be on them to find other ways to cut costs.

One way that this can be achieved is to look at music licensing. In two years at MMS, we have saved almost £920,000 for pubs, bars, clubs, and hotels by taking control of their PRS and PPL licence renewals, and submitting them accurately.

One call to MMS could provide a business with enough savings to cover the increased cost of the minimum wage.

Here are two real-life examples of businesses in the pubs and bars sector that we have helped recently, with an illustration of what that would mean against the context of the National Minimum Wage increases:

Example 1

We have saved £101,000 for a well-known bar group, across all of its sites for a 12-month period. That’s enough to cover the wage increases for around 50 staff.

Example 2

MMS has helped a major Scottish pub group to save £28,500 over the same period: enough for just over 14 wage increases.

 

It’s such a simple thing, but the difference saved could be the difference between letting a member of staff go and not. Or, it could allow you to ensure you retain your best, most experienced staff by paying them the wages their extra experience, and the new legislation, requires.