The National Living Wage (NLW) will rise to £8.21 from April 2019 an increase of 4.9 per cent, while the government has also accepted the Low Pay Commission’s (LPC’s) above inflation recommendations to increase the National Minimum Wage (NMW).
Philip Hammond announced the increases in his 2018 Budget speech, stating: “Delivering higher wages for those in work is core to my mission as Chancellor.”
The increases will see a full-time worker on the NLW receiving an annual pay increase of £690.
The rises in the NMW rates, to come into force from April 2019, are as follows:
- from £7.83 to £8.21 for workers aged 25 and over (the National Living Wage)
- from £7.38 to £7.70 for 21-24 year olds
- from £5.90 to £6.15 for 18-20 year olds
- from £4.20 to £4.35 for 16-17 year olds
- from £3.70 to £3.90 for apprentices aged under 19 or in the first year of their apprenticeship.
The government has set out its full response to the LPC’s recommendations.
“The current remit of the LPC is for the NLW to reach 60 per cent of Median Earnings by 2020, subject to sustained economic growth,” said Hammond in his speech. “But next year we will need to give the LPC a new remit beyond 2020.
“We will want to be ambitious with the ultimate objective of ending low pay in the UK but we will also want to be careful – protecting employment for lower-paid workers.
“So we will engage responsibly with employers, the TUC, and the LPC itself over the coming months gathering evidence and views to ensure we get this right – and I will confirm the final remit at the Budget next year,” he added.
