National Minimum Wage rates increase

Posted on: October 2nd, 2015

From 1 October 2015, the National Minimum Wage will increase.

The new rates are as follows:

  • For individuals aged 21 and over, the increase is 20 pence to £6.70 per hour;
  • For individuals aged 18-20, the increase is 17 pence to £5.30 per hour;
  • For individuals aged 16-17, the increase is 8 pence to £3.87 per hour;
  • For apprentices, the increase is 57 pence to £3.30 per hour; and
  • The accommodation offset increases from £5.08 to £5.35.

It is important to note that the new rates apply to pay reference periods beginning on or after the 1st October 2015.

National Living Wage

From April 2016 individuals aged 25 and over will be entitled to receive the National Living Wage. This will begin at £7.20. The National Minimum Wage will remain in place for individuals under 25, in line with the rates above. Please note that the National Living Wage is mandatory and employers who fail to pay it will be fined.

Before April 2016, we recommend you:

  • consider whether the pay structures you have in place will comply with the National Living Wage;
  • ensure your financial planning budgets for the increase in wages for employees currently paid below this who are aged 25 years and over;
  • assess whether this will have any impact on pension costs and other employee benefits;
  • consider whether this will have an impact on other pay grades because there is likely to be a desire for pay differentials to be maintained.

If the National Minimum Wage increase will affect your organisation or you wish to discuss your situation and further steps, please contact the Employment Team on 023 9236 6049.