Legal Changes on the Horizon in 2016

The recruitment industry is, according to the REC, in rude health!

It predicts that in 2016 more than 90% of employers will increase headcount.  However, one of the significant external influences that is going to hit the sector this year is the National Living Wage.


From April 2016 individuals aged 25 and over will be entitled to receive the National Living Wage of £7.20 per hour, increasing to above £9 per hour by 2020.  Overall this is expected to cost employers £804m-£672m in wages and £132m in associated non-wage costs, such as NICs.  There is also likely to be a ripple effect as businesses try and maintain pay differentials, estimated to cost employers £59.5m.

The cost to end-clients, allowing for holiday pay and pensions, means either that recruiters will need to increase their pricing to preserve their margin or their margin will be reduced.

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