National Living Wage to Increase to £11 in April 2024

4 Oct
by Suzie Business Owner & Senior HRBP

Chancellor Jeremy Hunt revealed that the national living wage is set to exceed £11 next year in April 2024. This wage increase will directly benefit around two million workers aged 23 and older, who currently earn £10.42 per hour.

What is the minimum wage?

The National Living Wage, also known as the minimum wage, varies based on the age of the employee and is updated annually in April. As of April 1, 2023, the following rates apply:

National Living Wage for over-23s: £10.42 per hour
National Minimum Wage for those aged 21-22: £10.18
National Minimum Wage for 18 to 20-year-olds: £7.49
National Minimum Wage for under 18s: £5.28
The Apprentice rate: £5.28

The apprentice rate is applicable to individuals under 19 years old or those over 19 in their first year of apprenticeship. It’s essential to note that the minimum wage remains consistent across all regions of the UK.

The government predicts that this rise will result in an additional £1,000 in annual earnings for full-time workers on the national living wage.

Important Reminders and Enforcement

It is mandatory for employers to pay the minimum wage to their employees. Failure to do so can lead to fines imposed by the HMRC. If you believe you are entitled to the minimum wage but are not receiving it, you can file a complaint through the HMRC website. Alternatively, you can seek advice from the Acas website or by calling their helpline on 0300 123 1100.

Consequences for Non-Compliance

Recent reports indicate that over 200 companies, including WH Smith, Marks & Spencer, Argos, and Lloyds Pharmacy, were fined nearly £7 million and instructed to compensate 63,000 workers for minimum wage breaches dating back over a decade. WH Smith had the highest number of offenses, failing to pay over £1 million to more than 17,600 workers.

Who Sets the Minimum Wage?

The rates for the minimum wage are determined annually by the government, based on advice from the Low Pay Commission, an independent advisory group. The Commission’s recommendations align with employment figures, earning trends, and essential expenses like food and housing.

Exemptions and ‘Real Living Wage’

The voluntary “Real Living Wage,” which is set by the Living Wage Foundation charity, benefits over 430,000 workers in the UK. This wage exceeds the legal minimum and reflects the foundation’s estimation of what individuals need to cover their everyday expenses. Presently, the Real Living Wage stands at £11.95 per hour in London and £10.90 per hour in other parts of the UK. Notable Living Wage-accredited employers include Google, Ikea, Aviva, Nationwide, and Burberry.

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