Make sure you stay updated with the latest national minimum wage increases. On the 1st of April, there were changes made to employment law that means that minimum wage has gone up.
National Minimum Wage Increases – Change in Employment Law
As announced in October’s budget, the National Living Wage has increased by 4.9% – from £7.83 to £8.21. Though an improvement, these rise in wages coincide with rises to council taxes and TV licence fees! 200,000 people are meant to be affected by this pay rise, and of this amount, 60% are women, who work in the retail and hospitality sectors.
Employees aged 25 and over are entitled by law to be paid National Living Wage. However, those under 25 are not. They are required to be paid varying amounts of National Minimum Wage depending on age.
National Minimum Wage Increases – Compulsory Amounts
- Apprentice Wage is increasing from £3.70 to £3.70
- Under 18s Wage is increasing from £4.20 to £4.35
- 18-20s Wage is increasing from £5.90 to £6.15
- 21-24s Wage is increasing from £7.38 to £7.70
National Living Wage vs The Real Living Wage
There is still confusion over the difference between National Minimum Wage and Real Living Wage.
- National Minimum Wage is now the amount of £8.21 which is required, by law, to be paid to workers aged 25 and over.
- Real Living Wage is an amount devised by the Living Wage Foundation, which argues that the Government’s National Living Wage isn’t high enough to meet needs of employees. The Living Wage Foundation believes that over 18s should be paid a wage of £9.0o across the UK and £10.55 in London, and it shouldn’t be split between under/over 25s as living costs don’t vary depending on that difference. They explain that these amounts have been devised appropriately according to rising cost of living, services and household goods. At the moment, only 5,000 businesses in the UK pay this Real Living Wage including ITV, Google and IKEA.
A Glasgow accountant from The Kelvin Partnership can make sure you are paying your employees correctly! We are passionate about always keeping clients up to date with the latest in all aspects of accounting – just take a look at our last post.