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Costa Coffee fails to reveal if Northern Ireland workers will get pay rise planned for Britain

By John Mulgrew

Published 01/10/2015

Baristas at GB Costas will be paid £7.40 an hour from AprilCosta
Baristas at GB Costas will be paid £7.40 an hour from AprilCosta

Costa Coffee could not last night confirm if a pay rise announced for staff in Britain would be extended here.

Company owner Whitbread, which also owns the Premier Inn chain of hotels, recently announced an increase for its baristas slightly above the new national living wage.

The firm said that, from today, it would increase the pay of its 12,500 baristas, including members of staff younger than 25, to a minimum of £7.40 an hour.

But the business is run as a separate franchise across Northern Ireland and the Republic by Cork-based MBCC Foods Ireland, which operates 20 outlets in Northern Ireland.

Asked whether or not the business would pay its workers here the same new wage that has been introduced by Whitbread, MBCC Foods Ireland Limited did not provide a reply.

The national living wage will be £7.20 an hour and is due to be introduced next April. It is due to hit £9 by 2020.

Speaking about Whitbread's wage increase, Costa managing director Chris Rogers said: "We have chosen to pay the same rates to everyone as we strongly believe that if two people are making the same contribution, they should receive the same pay, and that it should be linked to training and skills levels, not age."

The company's announcement came three weeks after Andy Harrison, the boss of parent company Whitbread, warned that the firm would have to hike prices because it faced a "substantial" hit as a result of the living wage announcement made by Chancellor George Osborne in his last Budget.

Several other major employers have announced pay rises for staff in recent weeks, ahead of the introduction of the living wage.

But there are fears that the measure could disproportionately hit Northern Ireland businesses that cannot afford the increase, according to Glyn Roberts of the Northern Ireland Independent Retail Trade Association.

"The living wage which was unveiled is going to be unaffordable," Mr Roberts said.

"It is also unrealistic to expect businesses here to reach £9 an hour by 2020."

Mr Roberts added that the planned hike could increase small business costs by as much as 40%.

"We are going through an almost a perfect storm of cost issues, including rates and auto-enrolments," he added. "All three of these costs are coming down the pipeline at once.

"If the Government wants small businesses to be able to afford £9 an hour, then they have to give tax relief to at least meet halfway.

"It is obviously easier for big chains, but for small business owners it is a huge challenge."

Last month, it emerged that workers at Lidl in Northern Ireland would not benefit from a pay rise being introduced for staff across Britain.

The discount supermarket said it was giving a pay rise worth £1,200 a year to its staff in England, Scotland and Wales. The company will pay a minimum of £8.20 an hour across Britain, and £9.35 per hour in London from October 1, benefiting 53% of its 17,000-strong UK workforce. But its 600 Northern Ireland employees will not benefit because the operation here is separate to the one in Britain.

A spokeswoman for Lidl said the wages paid here were "among the best in the sector" and added: "Store assistants working in Lidl NI earn up to £8.60 per hour."

In July this year, Chancellor George Osborne surprised Parliament with the announcement of a 'living wage', significantly higher than the current £6.50 an hour rate for those aged 21 and over. Working people aged 25 and over, starting in April 2016 will receive £7.20 an hour. But that rate is also planned to increase to £9 an hour by 2020. While it has been welcomed by some, other businesses, including JD Wetherspoon boss Tim Martin, have criticised the move - concerned it could add "considerable uncertainty" to the hospitality industry as a whole.

Belfast Telegraph

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