The UK government have announced that the rates for National Minimum Wage (NMW) and National Living Wage (NLW) will increase from April 2021.
Furthermore, the National Living Wage will be the statutory minimum wage for workers aged 23 and over – a drop by two years, with the current rate applying to workers aged 25 and over.
The reduction in the NLW threshold follows a UK government review into the structure of the NMW youth rates and recommendations that were made in 2019. It is anticipated that the age threshold will further reduce to age 21 and over, by 2024.
What are the new National Minimum Wage rates?
| Rate from April 2020 | Rate from April 2021 | Increase | |
| National Living Wage | £8.72 | £8.91 | 2.20% |
| 21-22 Year Old Rate | £8.20 | £8.36 | 2.00% |
| 18-20 Year Old Rate | £6.45 | £6.56 | 1.70% |
| 16-17 Year Old Rate | £4.55 | £4.62 | 1.50% |
| Apprentice Rate | £4.15 | £4.30 | 3.60% |
| Accommodation Offset | £8.20 | £8.36 | 2.00% |
What should employers do?
Employers should review the wage rates for their employees and ensure these correspond with the new rates, according to their age, from April 2021.
If you would like any more information or a chat about what this means for your company, please do not hesitate to get in contact today.