Seven out of ten recruitment agencies have increased pay for temporary workers due to National Living Wage (NLW), suggesting that their clients may face additional cost pressure and seek to manage the demand of their temporary labour requirements more closely; that’s according to research from Comensura, a managed service provider for temporary labour.
Comensura, surveyed 183 recruitment agencies focused on providing temporary staff. It found that the effects of NLW have already hit the temporary labour sector; nearly half of the agencies surveyed had experienced a heavy or medium impact on their business, pressured to introduce new processes to monitor factors such as the current age of candidates and when they turn 25 and become entitled to NLW.
73% of agencies impacted by NLW pay increases say that on average they will have to give the full 50p increase per hour. The full impact of the changes has seen several recruitment agencies notify organisations they recruit for about the changes, and some have had to provide consultation to clear up any confusion and ensure that they are fully prepared.
Jon Milton, director at Comensura said:
“The recruitment industry has a job on its hands following the recent introduction of the National Living Wage, considering that so many recruitment agencies hire temporary workers on minimum wage. But agencies are on the right track by implementing processes that flag instances when they need to reward an increase. There is a burden of responsibility with customers too, as those who are acquiring temporary workers should seek evidence that recruitment agencies they work with are prepared. The consequences of non-compliance, such as financial penalties, are too severe not to take the changes into account. ”