MINIMUM WAGE - 13.12.2023

Minimum wage rises sharply

On the up. In November 2023 the government confirmed that it has accepted the proposals put forward by the Low Pay Commission in relation to the national living wage (NLW) and national minimum wage rates (NMW). This means that from 1 April 2024 the:

• NLW will rise by £1.02 from £10.42 p.h. to £11.44 p.h.
• youth development rate of the NMW, which is payable to all workers aged 18 to 20, will increase by £1.11 from £7.49 p.h. to £8.60 p.h.
• young workers rate which is payable to all workers aged 16 to 17 will rise by £1.12 from £5.28 p.h. to £6.40 p.h. ; and
• apprentice rate will rise by £1.12 from £5.28 p.h. to £6.40 p.h.

Extended. In addition to increasing the minimum wage rates, the government will be extending the NLW to all workers aged 21 on 1 April 2024 (currently it only applies to workers aged 23 and over). However, although the NLW and NMW rates will rise on this date, they are only payable from a worker’s next pay reference period.

In practice. For example, if a worker is paid monthly on, say, the 25th of the month, the applicable 2023/24 NLW or NMW rate will continue to apply until 25 April 2024. The worker will then be entitled to receive the increased NLW or NMW rate when their next pay reference period starts on 26 April 2024.

Tip. You’re not obliged to inform staff about any annual NLW/NMW changes, but confirming that increases have been actioned will help to avoid unnecessary queries. You should also notify an employee when their applicable NLW/NMW rate changes due to their birthday. We have created letters that you can issue in both scenarios (see The next step ).

For a letter advising NMW increase - due to legislation and a letter advising NMW increase - due to age, visit https://www.tips-and-advice.co.uk , Download Zone, year 26, issue 01.