As a result of the Chancellor’s Spring Budget announcement made earlier this month, the National Minimum Wage (NMW) rates have increased. This means that from April 2017 the rates that employers are required to pay their workers will change. Here, we set out some of the key points for businesses to bear in mind regarding the NMW.
Who is entitled to the NMW?
According to the Government, you must be school leaving age to be entitled to the NMW. People aged 25 and over can get the National Living Wage, whereas those aged 24 and entitled to the NMW which varies according to how old you are.
What is the NMW rate?
The NMW rate is dependent on age. For workers under 18, the current rate is £4.00 per hour which will increase to £4.05 in April. For those aged 18 to 20 years old, the hourly rate is due to rise from £5.55 to £5.60. For 21 to 24 year olds there is a 10p jump from £6.95 to £7.05 per hour. The biggest difference is for those aged 25 or over with the amount being paid increasing from £7.20 to £7.50.
What about for apprentices?
The current apprentice rate is £3.40 an hour, which will change to £3.50 in April. Apprentices are eligible to this amount if they are under 19 years old or aged 19 or over but in the first year of their apprenticeship. Apprentices who are 19 years or over are entitled to the NMW for their age group once they have finished the first year of their apprenticeship.
It is important for both employers and employees to know what these changes are and how they will affect workers ready for implementing them when the new tax year begins.
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