In April 2023, the national living wage (NLW) and national minimum wage 2023 (NMW) saw an increase. The new rates include £10.42 per hour for those aged 23 and over, £10.18 per hour for 21 and 22-year-olds, £7.49 per hour for ages 18 to 20, and £5.28 per hour for those under 18. Additionally, the apprentice rate went up to £5.28 per hour. These changes were to ensure fair compensation for workers across various age groups. Furthermore, this article highlights other statutory rates that will be implemented and emphasizes the importance of adhering to the minimum wage standards for each pay period. HR support services are also offered to assist employers with understanding and implementing these wage requirements effectively.
UK National Minimum Wage 2023
From April 2023, the national living wage (NLW) and national minimum wage rates (NMW) in the UK were increased. These rates were set to ensure workers receive fair payment for their labour. It’s important for both employers and employees to be aware of these changes to ensure compliance with the law.
NLW and NMW Increases
The national living wage (NLW) was increased from the previous £8.91 per hour to £10.42 per hour for individuals aged 23 and over. This rise is significant, reflecting the government’s commitment to ensuring individuals receive a fair wage for their work. Previously, the NLW applied only to those aged 25 and over, but now it includes individuals aged 23 and above.
Rate for Those Aged 21 and 22
For individuals aged 21 and 22, the new minimum wage rate is £10.18 per hour. This increase reflects the government’s recognition that younger workers also deserve fair payment for their work. It aims to address pay disparities based on age and promote equality in the workplace.
Individuals aged between 18 and 20 had their minimum wage rate increased to £7.49 per hour. This rise acknowledges the importance of providing fair wages to young workers who are starting their careers and may have limited experience or qualifications.
Rate for Those Under 18
For individuals under the age of 18, the minimum wage rate is £5.28 per hour. This rate recognizes the position of young workers who may still be in education or training and may be working part-time or in entry-level positions.
Apprentice Rate Increase
The apprentice rate increased to £5.28 per hour. This change was to support individuals who are undergoing apprenticeships and gaining valuable work experience while studying towards a qualification. It reflects the government’s commitment to investing in the skills and development of apprentices.
Accommodation Offset Increase
The accommodation offset is the maximum amount that an employer who provides live-in accommodation to staff, and pays the minimum wage, is allowed to deduct from daily pay. From April 2023, this offset increased to £9.10 per day. It is important for employers to understand that this offset applies only to accommodation costs and not to other expenses such as utilities, council tax, or uniforms.
Other Statutory Rates from April 2023
Aside from the NLW and NMW increases, there were also changes to other statutory rates from April 2023. The rate for statutory maternity, paternity, adoption, shared parental, and parental bereavement pay increased to £172.48 per week. The rate for statutory sick pay increased to £109.40 per week. These changes were to provide adequate support to employees during life events or periods of illness.
NLW/NMW per Pay Period
It’s important to note that the NLW and NMW rates apply to each pay period. Whether a worker is paid weekly or monthly, employers must ensure that the minimum wage is met for the hours worked in that period. Employers cannot balance out lower earnings in one pay period with higher earnings in the next to meet the minimum wage 2023 requirement.
Accommodation Offset is for Accommodation, Nothing Else
Employers need to be aware that the accommodation offset only applies to accommodation costs. It cannot be used to offset expenses such as utilities, council tax, uniforms, tools, or any other expenses related to the employee’s job. It’s essential to separate and accurately account for accommodation costs separately from other expenses.
HR Support for Employers
Understanding and implementing the national minimum wage rates can be complex, especially for businesses with multiple employees and varying pay structures. Seeking HR support can provide guidance and ensure compliance with the law. HR support services, such as those offered by myHRdept, can assist employers in understanding minimum wage requirements, conducting audits, and developing salary and benefits strategies for their organizations. Whether the employer is a charity, not-for-profit, or a commercial company, HR support services can provide the necessary expertise in navigating minimum wage regulations.
In conclusion, the UK national minimum wage rates increased from April 2023. These changes aim to promote fair wages for workers of different age groups and ensure compliance with employment laws. Employers must be aware of these changes and take the necessary steps to meet the new minimum wage 2023. Seeking HR support can provide guidance and ensure adherence to the law, ultimately benefiting both employers and employees.