The government has accepted the Low Pay Commission’s (LPC) recommendations on National Minimum Wage and National Living Wage (NLW) increases.
The rise in the NLW will see that it remains on path to reach 60 per cent of median earnings by 2020 – a target set out by government. The youth rates have also seen a bigger increase than expected due to positive economic indicators.
‘Those entitled to the 21-24 age rate will see the fastest percentage increase since 2006. Similarly, those entitled to the 18-20 age rate will see the fastest increase since 2004,’ stated the report.
These increases are due to come into effect from April 2018, subject to Parliamentary approval.The LPC recommended:
The National Living Wage (for workers aged 25 and over) should increase from £7.50 to £7.83; The rate for 21-24 year olds should increase from £7.05 to £7.38; The rate for 18-20 year olds should increase from £5.60 to £5.90; The rate for 16-17 year olds should increase from £4.05 to £4.20; The apprentice rate (for apprentices aged under 19 or in the first year of their apprenticeship) should increase from £3.50 to £3.70.The LPC also recommended that the accommodation offset increases from the current £6.40 to £7.00 from 1 April 2018.
