- April 9, 2020
- Posted by: Gary Parsons
- Category: Legislation Changes
In December 2019, the UK Prime Minister Boris Johnson announced a 6.2% increase in the National Living Wage (“the biggest cash increase ever”) and applies from 1st April 2020.
The national living wage is the government-mandated minimum wage for over 25-year-olds. The minimum wage for under-25s will also rise.
From April 2020, the new legal minimum rates are:
- The National Living Wage for ages 25 and above – up 6.2% to £8.72
- The National Minimum Wage for 21 to 24-year-olds – up 6.5% to £8.20
- For 18 to 20-year-olds – up 4.9% to £6.45
- For under-18s – up 4.6% to £4.55
- For apprentices – up 6.4% to £4.15
Typically, employees on a 37.5 hour, full-time contract, on the NLW will now expect to receive a salary of £17,004 per annum. This is up £994.50 per annum against the previous £8.21 rate in 2019/20.
For employers that pay the real Living Wage**, the rates have been revised to:
- London Living Wage – £10.75
- UK Living Wage – £9.30
** These alternative rates are calculated annually by the Resolution Foundation and overseen by the Living Wage Commission, based on the best available evidence about living standards in London and the UK.
The Chancellor also announced his plans to expand the reach of the National Living Wage to cover workers aged 23 and over from April 2021, and to those aged 21 and over within five years. This is expected to benefit around 4 million low paid workers.