London-based M Restaurants Group is to introduce a £10 per hour starting wage today (March 1st).
The rate is £2.17 higher than the national living wage (NLW) for those aged over 25 (£7.83), and almost double the £5.90 minimum for those aged between 18 and 20. However, it is still below the “real living wage” of £10.55 for those living and working in London.
The group’s founder Martin Williams said he wanted all hospitality employers to follow his lead, and help change the sector’s reputation for low pay. In an interview with Imbibe, he cited the UK’s departure from the European Union as one motivation for paying staff more.
“In a Brexit context, the industry faces a chronic staff shortage, as the country no longer attracts the amazing talent from Europe and beyond that we used to take for granted. The challenge is to educate and engage Gen Z and their parents, to highlight what an amazing and rewarding industry hospitality is.”
Williams said businesses could use the current environment of uncertainty as a “catalyst to make hospitality an attractive option to a limited workforce”.
Between 12.3% and 23.7% of the hospitality sector's workforce is made up of EU migrants, according to UKHospitality. Of 200 hotel managers surveyed by EY recently, 54% said the number of non-UK applicants for vacant roles had fallen since the June 2016 referendum.
In April, the NLW will rise to £8.21 per hour for those aged 25 and over. All rates and how they will change next month are available here.
The real living wage, not to be confused with the NLW, is calculated on “actual living costs”, according to the Living Wage Foundation. There are currently 155 businesses in the hospitality sector paying the £10.55 per hour rate as a minimum in London, or £9 outside of the capital.