The Chancellor, Rishi Sunak, announced on 25 November 2020 that the National Living Wage (NLW) will increase by 2.2% to £8.91 per hour from 1 April 2021. Going further, the Government has also decreased the age threshold from ages 25 and over to 23 and over.
National wage rates will increase, as follows:
|Age||Current rates||Rates from 1 April 2021|
|Workers aged 25 and over (NLW)||£8.72 an hour||–|
|Workers aged 23 and over (NLW)||–||£8.91 an hour|
|Workers aged 21‒24||£8.20 an hour||–|
|Workers aged 21‒22||–||£8.36 an hour|
|Development rate for workers aged 18‒20||£6.45 an hour||£6.56 an hour|
|Young workers rate for workers aged 16‒17||£4.55 an hour||£4.62 an hour|
|Apprentices under 19, or 19+ but in the first year of the apprenticeship||£4.15 an hour||£4.30 an hour|
By law, it is important that employers pay staff the correct national wage rates for their age groups or risk facing serious repercussions for failing to do so. The risks range from unlawful deductions from wages claims, fines from the Government, and/or being “named and shamed” as a “rogue” employer.