National minimum wage rate rises

by | Nov 5, 2021 | Business Advice, Taxation

The national living wage (NLW) will rise to £9.50 per hour for pay periods starting on and after 1 April 2022 along with the other national minimum wage rates. Since 6 April 2021, the NLW rate has applied to workers aged 23 and over.

The apprentice rate will rise significantly by 11.9% to £4.81 and will be aligned with the rate for employees aged 16 and 17. This will help employers, who will not have to have a formal apprenticeship agreement in place for trainees under 18 to pay the correct amount of NMW. Older apprentices do need a formal apprenticeship agreement.

Employers should keep a sharp eye on your employees’ birthdays to ensure that any rise in the NMW rate is implemented for the pay period that begins after they move into a different age category.

You can claim a £3,000 incentive for each apprentice hired before midnight on 31 January 2022.

Anyone employed through the Kickstart scheme must be paid the NMW relevant to their age. Employers must apply for funding to pay employees on the Kickstart scheme before 17 December 2021, but the start date for new employees on the scheme has been extended to 31 March 2022.

More detail on the new hourly rates for pay periods starting from 1 April 2022 is shown below:

  • NLW aged 23+*: £9.50 (currently £8.91)
  • Age 21-22: £9.18 (currently £8.36)
  • Age 18-20**: £6.83 (currently £6.56)
  • Age 16-17: £4.81 (currently £4.62)
  • Apprentice rate U/19***: £4.81 (currently £4.30)

* National living wage (NLW) introduced for workers over 25 years from April 2016. From 1 April 2021, the age for the NLW has been lowered to 23 years and above.

** Also for workers aged 21 years and above, starting a new job with an employer and doing accredited training (a course approved by the UK Government to obtain a vocational qualification).

*** An apprentice rate for apprentices who are under 19 or are 19+ and in their first year of an apprenticeship. All other apprentices are entitled to the NMW for their age band.

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