Employment News

News added on 13.01.2020

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National minimum wage

National living and national minimum wage rates from April 2020

The government has announced inflation-busting increases to the national living wage (NLW) and national minimum wage (NMW) rates from 1 April 2020. What are the new rates?

Accepting the recommendations of the Low Pay Commission in full, the government has confirmed that it will be increasing the NLW and NMW rates from 1 April 2020 as follows:

  • the NLW rate for workers aged 25 and over will rise by 6.2% from £8.21 to £8.72 per hour
  • the NMW rate for workers aged 21 to 24 will rise by 6.5% from £7.70 to £8.20 per hour
  • the NMW rate for workers aged 18 to 20 will rise by 4.9% from £6.15 to £6.45 per hour
  • the NMW rate for workers aged 16 and 17 will rise by 4.6% from £4.35 to £4.55 per hour
  • the NMW rate for apprentices aged under 19, or those aged 19 and over but in the first year of their apprenticeship, will rise by 6.4% from £3.90 to £4.15 per hour
  • the daily offset for the provision of living accommodation to a worker will rise by 8.6% from £7.55 to £8.20 per day.

The increase to the NLW means that the government will meet its current target, set several years ago, for the NLW to reach 60% of median earnings by 2020. It has now pledged to increase the NLW towards a new target of two-thirds of median earnings by 2024, provided economic conditions allow, which, on current forecasts, would make it around £10.50 per hour.

In addition, the government recently announced that the reach of the NLW is to be expanded to cover workers aged 23 and over from April 2021, and then it will be expanded again to cover those aged 21 and over within five years. This is expected to benefit around four million workers.

The NLW and NMW rates will all rise by significant amounts from 1 April 2020. The NLW will go up by 6.2% to £8.72 per hour. The various NMW rates will see increases ranging from 4.6% to 6.5%. The government’s new target is for the NLW to reach two-thirds of median earnings by 2024.

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