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Rise in National Living Wage from April 2023
17th November 2022
The Autumn Statement 2022 announced that the National Minimum Wage and National Living Wage rates will rise from 1 April 2023.
The Chancellor said that the government remains committed to ending low pay.
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From 1 April 2023, the National Living Wage (NLW) will increase by 9.7% to £10.42 an hour for workers aged 23 and over - the largest ever cash increase for the NLW.
With inflation currently running at 11.1%, this is a pay cut in real terms.
Young people and apprentices on the National Minimum Wage (NMW) rates will also see a boost to their wages.
Rates will be increased for people aged 21-22 by 10.9% to £10.18 an hour,
- for those aged 18-20 by 9.7% to £7.49 an hour,
- for 16–17-year-olds by 9.7% to £5.28 an hour, and
- for Apprentices by 9.7% to £5.28 an hour.
The rate for 21-22-year-olds has increased by a larger percentage than other rates, in advance of the NLW applying to all workers over 21 from an expected date of April 2024.
Businesses will need to plan ahead for the impact of these rises in staff costs.
|
From April 2023 |
Current Rate |
Increase |
|
| National Living Wage |
£10.42 |
£9.50 |
9.7% |
| 21–22-Year-Old Rate |
£10.18 |
£9.18 |
10.9% |
| 18–20-Year-Old Rate |
£7.49 |
£6.83 |
9.7% |
| 16–17-Year-Old Rate |
£5.28 |
£4.81 |
9.7% |
| Apprentice Rate |
£5.28 |
£4.81 |
9.7% |
| Accommodation Offset |
£9.10 |
£8.70 |
4.6% |
Difference in rates
The National Living Wage is different to the UK Living Wage and the London Living Wage calculated by the Living Wage Foundation.
Differences include that:
- the UK Living Wage and the London Living Wage are voluntary pay benchmarks that employers can sign up to if they wish, not legally binding requirements.
- the hourly rate of the UK Living Wage and London Living Wage is based on an attempt to measure need, whereas the National Living Wage is based on a target relationship between its level and average pay.
- the UK Living Wage and London Living Wage apply to workers aged 18 and over, whereas the National Living Wage applies to workers aged 23 and over.
- The LPC has no role in the UK Living Wage or the London Living Wage
Enforcement
Employers who do not pay at least the appropriate minimum wage face penalties as well as being named and shamed by HMRC.
Payroll information
If you would like to know more information about Bishop Fleming Payroll Services by IRIS, please click here.
