Around two million workers in the UK will get a pay increase from April onwards as the minimum wage rises.
The National Living Wage is now £8.91 - a 2.2% increase that will see an extra £345 in the pocket of a full-time employee each year.
Also, those aged 23 and over will be entitled to the National Living Wage for the first time, not just those aged 25 and over.
Apprentices and those aged between 18 and 22 will also get a pay increase, and the voluntary “Real Living Wage’ will also rise too.
However, thousands of workers on furlough will see no increase to their pay as they have all been excluded from the pay rises.
The government said that the minimum wage increases will particularly benefit those working in the retail, hospitality, maintenance, and cleaning sectors.
Boris Johnson said the increases would be "a welcome boost to families right across the UK".
Kwasi Kwarteng, Business Secretary, called on "all workers" to inspect their pay packets to make sure they’re "getting what they are entitled to, and remind employers of their duty to pay the correct wage".
However, Anneliese Dodds, shadow chancellor, has criticised the pay freeze for workers on furlough.
"Hitting Britain's families in their pockets isn't just wrong - it's economically illiterate. If families have less money to spend, then businesses will suffer and the recovery will take longer," Dodds said.
General secretary of the Trades Union Congress, Frances O'Grady, also denounced the decision to exclude those on furlough from receiving a pay increase.
"Low-paid workers on furlough have bills to pay like everyone else," O’Grady said.
"The government should guarantee that everybody will get at least the full rate of the minimum wage. And it should give all minimum wage workers a decent pay rise."
Chairman of the Low Pay Commission, Bryan Sanderson, said: "This week's increase is our first step towards the government's target of two-thirds of median earnings.
"It is a real-terms increase, meaning that an hour's work can buy more than it could last year at the start of the pandemic. The level of the new rate, however, also reflects the need to protect workers from job losses."
The Joseph Rowntree Foundation’s Mike Hawking said that the minimum wage rise was “necessary”, but that the coronavirus crisis has exposed just how urgently we need to combat in-work poverty.
"As we start to recover from the impact of the last year, too many workers are finding that minimum wage increases are being wiped out due to inadequate social security, insufficient hours available to them, and high housing costs."
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