GOVERNMENT CONFIRMS INCREASE TO NATIONAL LIVING WAGE AND NATIONAL MINIMUM WAGE IN APRIL 2023!

The NLW, which applies to all workers aged 23 and over, will increase by 92 pence (9.7%), from £9.50 to £10.42 per hour. That works out as a £150 a month extraIn line with the Low Pay Commission’s (LPC) recommendations, the Government has also announced the National Minimum Wage will increase for younger workers. The following will be introduced on 1 April 2023.

These recommendations, put forward by the LPC, ensure the NLW remains on track to achieve the Government’s target of two-thirds of median earnings by 2024, and supports the wages and living standards of low-paid workers at a time of financial hardship for many living in the United Kingdom.

Why is this important?

Employers will be expected to comply with the new National Minimum Wage rates from 1 April 2023.

The new rates will be:

• Age 23 or over: £10.42
• Age 21 to 22 – £10.18
• Age 18 to 20 – £7.49
• Age 16 to 17 – £5.28
• Apprentice – £5.28

Although the minimum wage is set by an hourly amount, it is not limited to employees that are paid per hour.  The rate applies to all workers across the UK, including: 

• Those working part-time or casually. 
• Workers in training. 
• Offshore workers. 

The new 2023 rates are the same across Scotland, Northern Ireland, Wales and England and will come into effect on the same date everywhere. 

There are a few groups of workers to whom these legal requirements do not apply. Self-employed workers, unpaid volunteers, company directors and members of family cohabiting with their employer are not entitled to the minimum wage.

What should you do?

Ensure you are prepared for the wage increase before 1 April 2023. For existing employees and new starters, you will need to ensure that you are paying the correct rate from that point onwards and you may need to update their contracts if they don’t already comply.