The Chancellor presented his latest budget to the House of Commons on Wednesday 22 November, including increases to the National Minimum Wage (NMW) and the National Living Wage (NLW).
The Government accepted the recommendations of the Low Pay Commission for increases to the NMW and the NLW, which it’s estimated will benefit more than 2 million workers. In light of this, the Government will increase the NLW from April 2018, which applies to workers aged 25 and over, from £7.50 to £7.83.
The NMW rates will be increased at the same time to: –
£7.38 for 21 to 24-year olds (from £7.05)
£5.90 for 18 to 20-year olds (from £5.60)
£4.20 for 16 and 17-year olds (from £4.05)
£3.70 for apprentices (from £3.50).
What is the difference between the National Minimum Wage and the National Living Wage?
The National Minimum Wage is the minimum pay per hour to which most workers aged 16 to 24 are entitled and these rates are reviewed every year by the Government. The Low Pay Commission, an independent advisory body made up of employers, trade union leaders and academics, advises on the level at which to set the minimum wage.
Workers receive different levels of minimum wage depending on their age (once they turn 16) and apprentices receive a lower rate.
The National Living Wage is the minimum wage for workers 25 and over.
The Low Pay Commission advises this different level of wage because there is evidence that younger workers are more at risk of being priced out of jobs than older workers, with worse consequences if they end up unemployed.
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