New National Minimum Wage rates exceed £10 an hour
This week, the government announced substantial increases to the National Living Wage and National Minimum Wage in line with the recommendations of the independent Low Pay Commission.
18.11.2022
The new rates, which apply from April 2023, are as follows:
- Rate for people aged 23 and over - £10.42 per hour [a 9.7% uplift to the current rate of £9.50]
- Rate for 21-22 year olds - £10.18 an hour [a 10.9% uplift to the current rate of £9.18]
- Rate for 18-20 year olds - £7.49 an hour [a 9.7% uplift to the current rate of £6.83]
- Rate for 16-17 year olds - £5.28 an hour [a 9.7% uplift to the current rate of £4.81]
- Apprentice rate - £5.28 an hour [a 9.7% uplift to the current rate of £4.81]
- Accommodation offset - £9.10 [a 4.6% uplift to the current rate of £8.70]
The Low Pay Commission said that the arguments for and against making substantial increases to the NMW was 'finely balanced' due to the 'unusual' position of the economy. It believes that businesses can manage these increases because of the 'tightness of the labour market and historically high vacancy rates'. Whether that remains true over the next year or so, remains to be seen.
The Low Pay Commission is charged by the government to reach a NMW target representing two-thirds of median earnings for all workers aged 21 and over by 2024. To do this it will need to increase the NLW to £11.08 in April 2024 and reduce the age bands for the NLW from 23 to 21 years old.
These rates are edging (slightly) closer to those recommended by the Real Living Wage Foundation that apply to workers outside the capital city. It calculates its rates according to the cost of living, based on a basket of goods and services. In September, it announced an increase in rates to £10.90 per hour for those living outside of London, and £11.95 for those working in London.
Our newsletters
We publish monthly employment newsletters. If you'd like to be added to the mailing list, please let me know.
Our fixed price employment law service
We also have a fixed price employment law service. Please contact Gordon Rodham if you'd like to find out how we can help you avoid these sorts of problems with our fixed-fee annual retainer, or flexible discounted bank of hours service.
https://www.theguardian.com/uk-news/2022/nov/17/autumn-statement-2022-key-points-jeremy-hunt-budget
Key Contacts
Related Articles
Expert CommentApril–March holiday years: the hidden bank holiday problemAll workers are entitled to at least 5.6 weeks holiday a year under the Working Time Regulations. Some employers include bank holidays within that allowance, others don't.
Expert CommentUnderpaying holiday pay? State enforcement is on its wayNext year, the Fair Work Agency will be able to take action against employers who aren't paying their staff correctly when they go on holiday.
Expert CommentWhat are the risks of using fixed-term contracts once six month unfair dismissal rights come into force?Many businesses engage staff on fixed or limited-term contracts to provide cover for staff on family-related leave, absent due to long-term ill-health, or to complete a specific project or task. Some contracts set out the date they are due to end, other set out the specific circumstances that will bring them to an end.
