2 days Ago By [email protected] (Patrick Edrich)
The changes were announced during chancellor Rachel Reeves' autumn budget last year Three and a half million of the lowest paid workers in the country will see their wages rise from tomorrow. The National Living Wage paid to over-21s will go up by 6.7% and the National Minimum Wage for 18 to 20-year-olds by 16% from April 1 2025 .
The new changes implement recommendations made by the Low Pay Commission, an independent body that advises the government, and were first announced by the chancellor Rachel Reeves in her autumn budget last year . Ms Reeves called the changes a "significant step" towards fulfilling the government's promise of a "genuine living wage for working people". The National Living Wage is going up from £11.
44 an hour to £12.21. The government has said the increase is worth around £1,400 a year for an eligible full-time worker .
It applies to employees aged 21 and over from April 2024. The pay rates are set by the government each year on the recommendations of the Low Pay Commission. The National Minimum Wage is for younger employees aged between 16 and 20.
The government said for 18, 19 and 20-year-olds, it will rise from £8.60 an hour to £10 from tomorrow. The increase will be worth £2,500 for an eligible full-time worker.
For those aged 16 and 17, the wage will rise from £6.40 an hour to £7.55, which is an 18% increase .
There is also a separate apprentice rate, which applies to eligible people under the age of 19, or those over 19 in the first year of their apprenticeship, will increase by the same amount. Does your employer have to pay the National Minimum Wage and National Living Wage? It is a criminal offence if employers don't pay the correct National Minimum Wage or Living Wage to their employees. The rates apply to staff even if they are not paid by the hour.
An employer not paying the correct amount can be fined by HM Revenue and Customs . Those who don't qualify for the National Minimum or National Living Wage include the self-employed, company directors, volunteers, members of the armed forces and prisoners. What is the Real Living Wage and how much is it? The Real Living Wage is an unofficial hourly rate of pay which is overseen by the Living Wage Foundation charity.
It is aimed at UK workers aged 18 and over, but is not a legal requirement. It currently stands at £12.60 an hour nationally and £13.
85 in London. The charity that oversees the wage calculates its rates using factors including housing, childcare, energy bills, food and transportation. The foundation accredits over 15,000 businesses that chose to pay their employees above the statutory minimum.
Employers who are signed up to the scheme must implement the new rates by 1 May 2025. The Living Wage Foundation said wage was worth £2,262 more per year in the UK than the legal minimum pay, and £4,700 more in London. Both Liverpool and Everton football clubs are accredited as paying the Real Living Wage, as are businesses such as Nationwide, Ikea and National Express.
Other businesses including Asda and Leon have committed to pay the wage by October. 'A real-terms pay increase for the lowest paid workers' Baroness Philippa Stroud, who is the chair of the Low Pay Commission, said: "These rates secure a real-terms pay increase for the lowest-paid workers . Young workers will also see substantial increases in their pay floor, making up some of the ground lost against the adult rate over time.
"We recognise these increases come at a time when employers are facing increasing pressure and it is vital we monitor and assess how businesses are responding. As we build our evidence base for future recommendations to the government, we will be launching a call for evidence in the coming weeks and holding in-person meetings up and down the country. I encourage all interested parties to get in touch with us.
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