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National Minimum Wage increase: What you need to know

national minimum wage

Changes to the National Minimum Wage come into affect on 1 April 2017. Employment lawyer Roger Spence details the main changes and what it means for employers.

What are the changes to the national minimum wage?

From 1 April 2017, the statutory national minimum wage for workers aged 25 and over increases from £7.20 to £7.50 per hour. The following national minimum wage increases will also take effect from that date:

  • The rate for workers aged 21 to 24 increases from £6.95 to £7.05 per hour;
  • The rate for 18 to 20-year-olds increases from £5.55 to £5.60 per hour;
  • The rate for 16 to 17-year-olds increases from £4.00 to £4.05 per hour;
  • The apprentice rate increases from £3.40 to £3.50 per hour; and
  • The accommodation offset increases from £6.00 to £6.40 a day.

How is the national minimum wage enforced?

The national minimum wage is enforced by HMRC with investigations initiated either by complaint from workers or third parties, or through targeted enforcement of businesses operating within known low-paying sectors.

Enforcement measures available to HMRC include service of notices of underpayment, civil penalties, “naming and shaming”, recovery of underpayments through tribunals or civil courts, and criminal prosecution.

What other changes to pay are coming in?

In addition to the national minimum wage increases, from 2 April 2017 the standard rates of statutory maternity, paternity, adoption and shared parental pay will rise from £139.58 to £140.98 per week (or 90 per cent of the person’s average weekly earnings if lower).

The standard rate of statutory sick pay will also rise from £88.45 to £89.35 per week with effect from 6 April 2017.

If you have any queries regarding the application of the statutory payment regime to your business, our experienced team of employment lawyers would be happy to help.

Roger Spence is head of employment law at Harrison Drury. For more information on how the changes to the National Minimum Wage will affect your business, contact Roger on 01772 258321.

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