Need-to-know facts about minimum wage changes

All employers should be aware of significant changes to the National Minimum Wage, which took effect on October 1.

Businesses that fail to implement the new National Minimum Wage changes face stiff financial penalties, as well as having to pay any wage arrears, calculated at current rates.

The steps you have to take

All contracts of employment should be thoroughly reviewed to make certain they are updated and conform to the new minimum hourly rates.

The changes also incorporate a fresh ruling on the lower age limit for adult workers. Initial estimates suggest this will affect around 850,000 workers.

What do the changes mean for my company?

The hourly rate increases are:

• Adult main rate (aged 21 and over) – from £5.80 to £5.93
• Youth development rate (aged 18 to 20) – from £4.83 to £4.92
• Workers aged 16 to 17 years – from £3.57 to £3.64
• A new minimum hourly rate of £2.50 will additionally be introduced for apprentices.

Is there anything else I should know?

Further major amendments include an extension of the adult main rate to 21-year-old workers; and the introduction of a minimum hourly rate of £2.50 for apprentices. This will apply to all apprentices under 19 or aged 19 and over, but in the first year of their apprenticeship and currently exempt from the National Minimum Wage.

If you require advice in this area please contact the Employment team on 01254 258321