Last November the Government announced that it has accepted the recommendation of the Low Pay Commission's (LPC) for the minimum wage rates that will apply from April 2024.
This will be the largest ever increase to the minimum wage in cash terms, so how did the LPC come up with these increases? Quite simply they are working on a target set by the Government back in 2019 that the National Living Wage should be equal two thirds of the median hourly pay of those 21 and over. Wages have seen a large increase in the last year or so and this has, of course, had an impact on the NLW.
For the first time the full national living wage will apply to 21 year olds, this has come down in recent years and applied to 25 year olds as recently as 2020. Although this will be very welcome news for the 5 million or so workers affected it will be a different story for some employers who may struggle with the additional cost.
New Rates for 2024
Age | Minimum Rate From April 2024 | Increase in Pence | Percentage Increase |
21 and Over | £11.44 | £1.02 | 9.8% |
18 to 20 | £8.60 | £1.11 | 14.8% |
16 to 17 | £6.40 | £1.12 | 21.2% |
Apprentice | £6.40 | £1.12 | 21.2% |
Accommodation Offset | £9.99 | £0.89 | 9.8% |
The minimum wage rates apply to all workers in the UK even if they are not paid by the hours, so you must ensure this is calculated very carefully.
There are exceptions, the minimum wage does not apply to workers who are self employed, company directors and of course unpaid volunteers.
It also does not apply to family members who live in the home of the employer and do household chores.
Rules for Apprentices
Rules for apprentices are slightly different. Apprentices are entitled to the apprentice rate if they are either
a. Aged 19 and Under
b. Aged over 19 and in the first year of their apprenticeship.
For example, an apprentice aged 21 in the first year of their apprenticeship are entitled to the minimum hourly rate of £6.40, after the first year they must be paid £11.44. Apprentices are entitled to the minimum wage rate for their age if they are over 19 and have completed the first year of their apprenticeship.
Further Reading
