Workers across the UK will get a pay rise from April as higher National Minimum Wage (NMW) rates are introduced.
According to the Government, around two million of the UK’s lowest paid workers will benefit from the rise in the National Living Wage (NLW) and NMW rates.
From April 2023, the NLW will increase by 92 pence per hour, or 9.7 per cent, to £10.42, whilst the NMW rates for younger workers will also increase.
Currently, the National Living Wage applies to those 23 and over, after the age was lowered from 25 in April 2021.
Those aged 21-22 will earn £10.18 an hour – an increase of £1 – whilst 18-20 year-olds will receive £7.49 an hour after an increase of 66p is applied.
Apprentices and 16 and 17-year-olds will receive £5.28 an hour, which is an increase of 47p.
These rates are for the National Living Wage (for those aged 23 and over) and the National Minimum Wage (for those of at least school leaving age).
The existing rates, and the rates applicable from 6 April 2023 are as follows:
|23 and over||21-22||18-20||Under 18||Apprentice|
|6 April 2022-5 April 2023||£9.50||£9.18||£6.83||£4.81||£4.81|
|6 April 2023 onwards||£10.42||£10.18||£7.49||£5.28||£5.28|
The Low Pay Commission (LPC) estimates that there were two million workers paid at or below the minimum wage in April 2019, around seven per cent of all UK workers.
Penalties for failing to meet statutory wage rates
If an employer is found by HM Revenue & Customs (HMRC) to have failed to pay the minimum wage, the actions that can be taken against them include:
- Requiring payment of the outstanding amount owed, going back up to six years, through the issuance of a notice
- Imposing a fine of no less than £100 per employee or worker affected, and up to £20,000 regardless of the amount of underpayment
- Pursuing legal action, including criminal proceedings
- Providing the names of businesses and employers to the Department for Business, Energy & Industrial Strategy (BEIS), which may choose to list them publicly.
Clearly, compliance with the new rates is not optional and employers should ensure that they have made the appropriate preparations and checks ahead of 6 April, to avoid falling foul of the rules.
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