NLW/NMW - what’s in store for 2024?
Fully independent. The Low Pay Commission (LPC) is an independent body which advises the government on the national living wage (NLW) and the national minimum wage (NMW). The government isn’t obliged to accept the LPC’s annual recommendations, but it usually does so. Following the LPC’s advice, on 1 April 2023 the:
- NLW , which is payable to all workers aged 23 and over, went up from £9.50 to £10.42 p.h.
- adult rate of the NMW, which is payable to all workers who are aged 21 and 22, went up from £9.18 to £10.18 p.h.
- youth development rate, which is payable to all workers who are aged 18 to 20, went up from £6.83 to £7.49 p.h.
- young workers’ rate, which is payable to workers under 18 went up from £4.81 to £5.28 p.h .; and
- apprentice rate went up from £4.81 to £5.28 p.h.
On the cards. At the same time, the LPC announced its NLW/NMW recommendations for April 2024. It estimates that the 2024 NLW rate required to meet the government’s target will be in the range of £10.90 to £11.43 p.h. The LPC’s “central estimate”, i.e. the anticipated 2024 NLW rate, is £11.16 p.h. This is higher than its previous projection for 2024 and it may be increased again. The government’s decision on the 2024 NLW/NMW rates is expected in October 2023.
To be removed? In addition, the LPC has suggested that the apprentice rate - which is now aligned with the young workers rate of the NMW, i.e. £5.28 p.h. - should be removed entirely. If this proposal is accepted, the minimum wage for an apprentice would be the same as for another worker of the same age. Tip. What’s already guaranteed for 1 April 2024 is that the NLW age threshold will be lowered and all workers aged 21 and over will be entitled to receive that higher rate. You can start planning for this now using the LPC’s projected NMW range for 2024.
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