From 1st April 2022, the National Living Wage will see a significant jump of 59p, representing an increase of 6.6%.

Current rate – £8.91

New rate – £9.50

The Low Pay Commission’s recommendations set the minimum wage back on track to reach the Government’s target of two-thirds of median earnings by 2024. The recommendations were unanimously agreed by Commissioners and accepted in full by the Government. 

What else is increasing?

                                     Rate from April 2022    Current rate    Increase
National Living Wage         £9.50                           £8.91            6.6%
21-22 Year Old Rate          £9.18                            £8.36             9.8%
18-20 Year Old Rate          £6.83                            £6.56             4.1%
16-17 Year Old Rate          £4.81                            £4.62             4.1%
Apprentice Rate                 £4.81                            £4.30             11.9%
Accommodation Offset    £8.70                           £8.36             4.1%

We can see that the apprentice rate shows the greatest increase, from £4.30 to £4.81 per hour. This also brings the rate into line with the rate payable to a 16 – 17 year old who isn’t on an apprenticeship programme.

We also see a significant increase to the 21 – 22 year old rate, narrowing the gap between it and the rate for those over the age of 23. 

What do I need to do now?

There’s no action needed at this point in time although if you’re starting to plan 2022/23 budgets for your business, it’s worth introducing these rate increases, particularly if you have a number of staff on minimum wage. 

It’s also worth bearing in mind that if you are paying an employee a rate that’s currently more than the NMW of £8.91 but less than the 1st April rate of £9.50, they too will be in line for a pay increase to ensure that you’re not in breach of minimum wage legislation.