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National Minimum Wage

David McRae
18th Oct 2016

On 1 April 2016 the government introduced the new mandatory National Living Wage (NLW) for workers aged 25 and above, who are now entitled to be paid a minimum of £7.20 per hour.

However, the National Minimum Wage (NMW) rates for workers under the age of 25 are separately subject to their annual review each 1 October. Therefore, on 1 October 2016, the minimum wage rates for those under 25 years of age were increased as follows:

 

  • For workers aged 21 to 24: £6.95 per hour

  • For workers aged 18 to 20: £5.55 per hour

  • For workers under 18 but above compulsory school leaving age: £4.00 per hour

  • For apprentices aged under 19 or in the first year of their apprenticeship: £3.40 per hour

 

Enforcement powers for non-payment of any applicable rate of the National Minimum Wage were recently extended. The maximum fine for non-payment is now £20,000 per worker and employers who fail to pay can be banned from being a company director for up to 15 years.

 

The Department for Business, Skills and Innovation has written a guide on calculating the minimum wage, which can be found here.

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