Minimum wage rates will see substantial increases from 1 April 2024 – welcome news for younger workers and apprentices, but not so much for those employers struggling in the current economic climate.
Eligibility for the National Living Wage is to be extended by reducing the age threshold so that 21 and 22-year-olds are included. Current and future rates of National Living/Minimum Wage are:
| Current | From 1 April 2024 | Increase | ||
| Age | Rates | Age | Rates | % |
| 23 and over | £10.42 | 21 and over | £11.44 | 9.8% |
| 21 to 22 | £10.18 | 12.4% | ||
| 18 to 20 | £7.49 | 18 to 20 | £8.60 | 14.8% |
| Under 18 and apprentices | £5.28 | Under 18 and apprentices | £6.40 | 21.2% |
Employers can only pay the apprentice rate if the apprentice is aged under 19 or, if older, is in the first year of their apprenticeship. Apprentices over 19 who have completed the first year of their apprenticeship must be paid the rate for their age.
The provision of accommodation is the only benefit counting towards the National Living/Minimum Wage, with the maximum offset from 1 April 2024 set at £9.99 a day (£69.93 a week).
Real Living Wage
Some 14,000 employers – covering over 460,000 employees – now pay the Real Living Wage. This is on a voluntary basis, with the Real Living Wage independently calculated based on actual living costs.
- The current hourly rate of Real Living Wage outside of London is £12, so – with the latest increase – the National Living Wage is not far off parity.
- Where the government’s rate falls down, however, is for London-based employees where a Real Living Wage of £13.15 is deemed necessary due to the higher costs of working and living in the capital.
Also, the National Living Wage covers employees aged 21 and over, but the Real Living Wage applies from age 18.
HMRC’s National Living and Minimum Wage calculator for employers can be found here.
Our Yorkshire and Derbyshire based Accounting & Business Advisory can assist on 0114 266 4432 or info@smh.group
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