National Living Wage (NLW) and National Minimum Wage (NMW)
The new pay rates will come into force from 1st April 2024.
Rates Structure
The hourly rate for the minimum wage depends on your age and whether you are an apprentice.
From 1st April 2024, workers aged 21 and over will be entitled to the National Living Wage. Previously this had only been available to workers aged 23 and over.
Apprentices are entitled to the apprentice rate if they’re either:
- aged under 19
- aged 19 or over and in the first year of their apprenticeship
The National Living & Minimum Wage Rates 2024
The National Living Wage (NLW) will rise to £11.44 from 1 April 2024, an increase of £1.02 or 9.8 per cent.
All rates which will apply from 1 April 2024:
| Rate from 1st April 2024 | Annual Increase £ | Annual Increase % | |
|---|---|---|---|
| National Living Wage (aged 21+) | £11.44 | £1.02 | 9.8% |
| 18-20 Year Old Rate | £8.60 | £1.11 | 14.8% |
| 16-17 Year Old Rate | £6.40 | £1.12 | 21.2% |
| Apprentice Rate | £6.40 | £1.12 | 21.2% |
| Accommodation Offset | £9.99 | £0.89 | 9.8% |
Salaried Employees
Ensure you are paying the correct minimum wage rate to salaried employees. For employees on standard hours, you can calculate this by:
Number of hours worked per week x 52 weeks per year = annual hours
Annual hours x £11.44 = Minimum annual salary
Example:
For an employee 21 and over who works 37.5 hours per week the minimum salary will be £22,308
37.5 x 52 = 1950
1950 x £11.44 = £22,308
Varied Hours
To ensure you are paying correct rate you must check the calculation of hours and pay based on the relevant pay period eg if an employee has variable hours each month and are paid monthly, the pay at the end of each month must meet the minimum wage requirements.
Real Living Wage
If, as an employer, you have signed up to the voluntary Real Living Wage set by the Living Wage Foundation the rates increased in October to £12ph for those outside of London and £13.15ph for those working in London and you will have until 1st May 2024 to implement them to maintain your Real Living Wage Employer status.
Class 1 NI Contributions (NIC)
The main rate of primary Class 1 NICs will be cut by 2 percentage points from 10% to 8%.
Class 1 NICs are based on earnings from PAYE income only and are made up of a combination of employee salary deductions and employer payments.
The primary contribution is the part paid by the employee, secondary contributions are the part paid by the employer.
Therefore this change will reduce the contributions paid by employees earning via PAYE income only not employers’ NI.
| Class 1 NIC’s Weekly Basis | Class 1 NIC’s Monthly Basis |
| On first £242: Zero | On first £1,048: Zero |
| On income between: £242 and £967: 8% | On income between £1,048 and £4,189: 8% |
| On amount above: £967: 2% | On amount above £4,189: 2% |
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