Changes to the National Minimum Wage
Mark Ridley reviews changes to the National Minimum Wage
The Government has announced the new rates for the National Living Wage and the National Minimum Wage. The National Living Wage is currently the National Minimum Wage for workers aged 21 and over.
The Government has chosen to accept all of the recommendations submitted to them on 25th October 2024, by the Low Pay Commission*.
The recommendations of the Low Pay Commission, and their reasoning, are set out in a letter from Baroness Stroud, the chair of the Commission. These have been published on the Government website, posted here:
https://www.gov.uk/government/publications/minimum-wage-rates-for-2025
Of particular note is that the Commissions increase to the National Living Wage is intended to meet the Governments target of being at least two thirds of median earnings for 2024.
In determining the recommended rate the Commission, for the first time, took into account the cost of living and inflation trends.
The new rates of National Minimum Wage will be as follows:
- Apprentices - £7.55, an increase of £1.15 or 18%
- 16-17 year olds - £7.55, an increase of £1.15 or 18%
- 18-20 year olds - £10.00, and increase of £1.40 or 16.3%
- 21 and over (National Living Wage) - £12.21, an increase of £0.77 or 6.7%
- Accommodation offset** - £10.66, an increase of £0.67 or 6.7%
In it’s press release, the Government stated “The LPC’s recommendations are based on extensive consultation with employers, workers, representatives of both groups and other expert bodies, as well as a series of regional visits across the UK. They reflect unanimous agreement among Commissioners, including those representing workers, employers and independent experts.”
*The Low Pay Commission is an independent body made of employers, experts and trade unions.
This is not legal advice; it is intended to provide information of general interest about current legal issues.