Are You Ready For the National Living Wage? -

Are You Ready For the National Living Wage?

For some time now, we have been hearing in the news about changes to minimum wages, and the introduction of a National Living Wage.  This is set to be one of the biggest changes since the National Minimum Wage was introduced in April 1999.

To make it as simple as possible for everyone to understand, we’ve broken the changes down as follows:

 

What is the National Living Wage (NLW)?

In April 2016, legislation will change to introduce a mandatory National Living Wage (NLW). This is a top up to National Minimum Wage (NMW) for workers aged 25 and above.

The National Living Wage has been introduced to ensure work pays, and reduce reliance on the UK benefits system.

Currently, the minimum wage for workers aged 21 and above is £6.70 per hour.

From 1st April 2016 a top up will come into effect for workers aged 25 and above, and not in their first year of an apprenticeship. This will initially be set at £7.20 per hour, giving these workers an additional 50p per hour. 

The National Living Wage will be enforced as strongly as the current National Minimum wage.shutterstock_130862018-728x410

 

What should you be doing?

  • Carry out an audit of your payroll to know who is eligible for this new top up – anyone aged 25 or over will need to be earning at least £7.20 per hour from 1st
  • Inform those who are eligible of their new pay rate.
  • Ensure this adjustment is made with effect from 1st April 2016.
  • Check that your staff who are under 25 are earning at least the National Minimum Wage

The Rates:

Minimum Wage rates from 1st April 2016 will be:

For 25’s and over £7.20 per hour
For 21 – 24 year olds £6.70 per hour
For 18 – 20 year olds £5.30 per hour
For 16 – 18 year olds £3.87 per hour
Apprentices

(the rate applies to all apprentices in year 1 of an apprenticeship, and 16-18 year old apprentices in any year of an apprenticeship)

£3.30 per hour

 

As with any legislative changes, there is likely to be transition period. The Cummins Mellor Recruitment Team are committed to ensuring we remain abreast of all legislation changes. If you require any further information, please contact one of our consultants and we will do our best to assist you.

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