The National Minimum Wage (NMW) rates are expected to increase as of April 2019.
Why does it matter?
The National Living Wage (applicable for workers aged 25 and over) will increase by 4.9% from £7.83 to £8.21 with effect from 1 April 2019. NMW rates for workers under 25 will increase above inflation and average earnings. The NMW increases are smaller than those recommended, this is due to the comparatively weaker labour market conditions for young people over the past year. Obviously increased NMW means higher costs of production for businesses. However, a less obvious outcome we anticipate is a likely increase in wages of more qualified workers in order to maintain wage differentials.
| Year | 25 and Over | 21 to 24 | 18 to 20 | Under 18 | Apprentice |
|---|---|---|---|---|---|
| April 2018 (Current Rate) | £7.83 | £7.38 | £5.90 | £4.20 | £3.70 |
| April 2019 | £8.21 | £7.70 | £6.15 | £4.35 | £3.90 |
What action should you take?
Ensure that there is a plan in place for how best to deal with the higher costs of production.
At Gepp Solicitors our Employment Law Team will be happy to assist you with any aspect of employment law. If you seek advice, please contact our Head of Department, Alexandra Dean on 01245 228141 or via deana@gepp.co.uk.
This is not legal advice; it is intended to provide information of general interest about current legal issues.
