The National Living Wage (NLW) is the minimum pay rate an employer can offer workers aged 23 and over and is set to increase by 9.7% on 1st April 2023. This will be the largest single increase since the rate was introduced in 2016 and continues the Governments drive to raise the NLW to two-thirds of median earnings by 2024.
Other minimum wage rates will see similar increases and Employer’s will also need to agree revised rates for the supply of any agency workers who receive minimum earnings.
Paying the National Minimum Wage can be more complex than just paying workers the correct rate. These are just a few of the risks and common causes of underpayment:
-
deductions and payments for items or expenses that are connected with the job
-
unpaid working time for example, team handovers between shifts or time spent passing through security checks on entry and exit
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incorrect use of apprenticeship rates for example, paying the minimum wage apprentice rate when the worker is not a genuine apprentice, or paying the minimum wage apprentice rate before a worker starts their apprenticeship, or after it ends
The full range of increases that become effective in April 2023 are as follows:
|
National Living Wage
|
2022 rate
|
2023 rate
|
% Nominal increase
|
Cash increase
|
|
23 Year old and over
|
£9.50
|
£10.42
|
9.7%
|
92p
|
|
21 to 22 Year old
|
£9.18
|
£10.18
|
10.9%
|
£1
|
|
18 to 20 Year old
|
£6.83
|
£7.49
|
9.7%
|
66p
|
|
Under 18 Years
|
£4.81
|
£5.28
|
9.8%
|
47p
|
|
Apprentice
|
£4.81
|
£5.28
|
9.8%
|
47p
|
|
Accommodation offset
|
£8.70
|
£9.10
|
4.6%
|
40p
|