Increases To Minimum Wage Rates

Since the government implemented the National Living Wage (NLW) in April 2016 we now get the increases to National Minimum Wage (NMW) and NLW in April each year.

National Living Wage (NLW) applies to everyone aged 25 and over, while National Minimum Wage (NMW) applies to people under 25.

It is a legal requirement that all UK employees are paid at these new rates from 1st April 2018, with HMRC issuing large fines and publically naming and shaming companies that do not comply.

The rules around NMW can be quite easy to fall foul of if you aren’t careful. Things like unpaid overtime and time for training count towards an employee’s hours. If your employees are staying over their contracted hours for a staff training session, you may have to pay them for this to ensure you are compliant.

You must also be careful with deductions for overpaid wages or loans made to employees, as if these take the hourly rate below the NMW they will not be allowed.

This year’s rates are shown below.

  • Age              Rate

  • 25 and over        £7.83
  • 21 to 24              £7.38
  • 18 to 20              £5.90
  • Under 18            £4.20
  • Apprentice*       £3.70

*If under 19 or in first year of apprenticeship (otherwise refer to age bands). The apprenticeship rate does not apply to Higher Level Apprenticeships.

The rates for the previous year are below for comparison.

  • Age              Rate

  • 25 and over        £7.50
  • 21 to 24              £7.05
  • 18 to 20              £5.60
  • Under 18            £4.05
  • Apprentice*       £3.50

*If under 19 or in first year of apprenticeship (otherwise refer to age bands). The apprenticeship rate does not apply to Higher Level Apprenticeships.

If you are unsure of whether you’re paying your employees correctly or have any queries, we will be happy to review your payroll with you to make sure everything is as it should be.