The Government has accepted the Low Pay Commission’s recommendation for a 4.4% increase in the National Living Wage which takes the rate for workers aged 25 and over from £7.50 to £7.83 an hour, effective from 1 April.
There have also been larger increases to the statutory minimum rates for younger workers, in an effort to close the gap between the statutory rate for ‘adult’ workers and that for workers aged under 25.
|Statutory minimum wage rates at 1 April 2017 and 1 April 2018|
|Rate||April 2017||April 2018||Annual increase|
|25 and over||£7.50||£7.83||4.4%|
|21-24 year olds||£7.05||£7.38||4.7%|
|18-20 year olds||£5.60||£5.90||5.4%|
|16-17 year olds||£4.05||£4.20||3.7%|
The only exception is for younger workers aged under 18 where the increase is more modest at 3.7%, due to the fact that there have been other changes to the youth labour market, such as increasing educational participation (following the rise in school age to 18 in England and Wales). The statutory minimum rate for 16/17 year old will rise from £3.50 to £3.70 an hour on 1 April 2018.
Meanwhile the accommodation offset has been increased by 9.4% to £7.00.
To take part in our short poll on Employers Initial Reactions to the NLW Uprating follow this link.