Workers aged over 25 earning the minimum rate of £6.70 per hour will see a 50p increase on 1 April. The compulsory minimum wage will be £9 per hour from 2020.
Caesar, who is also managing director of Bransford Webbs Plant Company, which is not cutting workers' benefits, said he has heard of growers altering payment terms and conditions to pay no more than the statutory legal minimum sick pay or overtime. He added that cutting benefits back to statutory minimums is one of the few ways nurseries can recoup the "huge impact" of the pay hike. "That's an area people have got little option to consider," he said. "We have got no option to accept it (NLW) but people are concerned because it is going to put up their costs - no two ways about it."
He said the April rise is "probably not going to impact on differentials further up the pay chain", but with the rate set to be £9 per hour by 2020 it will impact on differentials by then "and that's where the real cost is. We can't expect supervisors to supervise on the same rate of pay of those they are supervising." Bringing in more under-25s is not feasible because it means getting rid of current staff, he explained, and some businesses might not have planned ahead enough for the next five years.
Retailers such as B&Q have cut bonuses and double time for bank holidays ahead of the pay rises. Labour MP Siobhain McDonagh raised the issue during Prime Minister's Questions, saying some B&Q employees could see their salaries fall in real terms. Speaking ahead of the Budget on 16 March, she asked David Cameron to ensure that it included regulation to make sure no worker is paid less because of the introduction of the NLW.
A B&Q representative said the retailer is offering compensation to the equivalent of 12 months of any reduction in overall pay for anyone who suffers a wage drop and added that no employee's basic salary would be hit by introducing the NLW.
"From 1 April 2016 our minimum rate will be £7.66 per hour, 46p more than the NLW's £7.20 per hour", said B&Q. "This will be our minimum rate for all employees, regardless of age, not just those 25 years and over who are covered by the NLW." B&Q said 90 per cent of customer advisers would get an increase in their basic salary on 1 April. The company said it is "aligning allowances", that it said are paid inconsistently, which includes standardising bank holiday pay and bringing Sunday pay in line with other trading days.