The National Minimum Wage (Amendment) Regulations 2016 have been made, and come into force on 1 April 2016.
The regulations make it clear that from April 2016, the National Living Wage, which is a compulsory rate of pay, will apply to workers aged 25 and over and will replace the National Minimum Wage for these workers. This is a new national rate of pay which will initially be set at £7.20 per hour.
The National Minimum Wage will continue to apply to workers aged 18-24. From April 2016 the National Minimum Wage rate will be:
- £6.70 per hour for workers aged 21-24 years
- £5.30 per hour for workers aged 18 – 20 years
- £3.87 per hour for workers aged 16 – 17 years
- £3.30 per hour for apprentices who are under 19 or 19 or over in the first year of an apprenticeship.
There are a number of people who are not entitled to the National Minimum Wage, including the self-employed, students on work experience, the armed forces, workers living in an employer’s household and volunteers.
It is important for employers to ensure they are keeping up with their obligations in respect of the new rates of pay for all employees. Employers can face criminal prosecutions and unlimited fines for failing to pay at least the National Minimum Wage to eligible workers.