The National Living Wage is a mandatory higher rate for those over 21, while the National Minimum Wage is the lowest hourly pay legally allowed for workers
Millions of British workers are poised for a substantial pay increase this year – but plenty of others will miss out. Chancellor Rachel Reeves revealed the wage hike for both the National Living Wage and the National Minimum Wage during the Buddget, aiming to ensure fairer pay scales.
The National Living Wage is a higher mandatory rate for those aged 21 and over, while the National Minimum Wage is the lowest legal hourly pay for other workers at least school leaving age. Yet, it’s crucial to note that not all workers are entitled to this minimum pay – including 15 job categories.
It may come as a surprise that company directors, university students on work placements, and even members of the Armed Forces are not guaranteed this basic wage. Neither, perhaps less surprisingly, are people in jail.
The Government has provided a full list:
- Prisoners
- People on the following European Union (EU) programmes: Leonardo da Vinci, Erasmus+, Comenius
- Family members of the employer living in the employer’s home
- People shadowing others at work
- People who are volunteers or voluntary workers
- Workers on government pre-apprenticeships schemes
- Company directors
- People living and working in a religious community
- Self-employed people running their own business
- Workers on a government employment programme, such as the Work Programme
- Members of the Armed Forces
- Share fishermen
- People working on a Jobcentre Plus Work trial for up to 6 weeks
- Higher and further education students on work experience or a work placement up to one year
- Workers younger than school leaving age (usually 16)
Changes in wages, set to be implemented on April 1, 2025, are anticipated to affect over three million workers. Apprentices and those aged between 16 and 17 will see the most significant minimum wage increase, from £6.40 to £7.55 per hour – a substantial rise of 18%.
Additionally, those aged 18 to 20 will also witness a record surge in their minimum wage, which will ascend to £10 per hour. The final group, consisting of individuals aged 21 and above, will soon benefit from a 6.7% salary increase worth 77p.
That will boost the National Living Wage to £12.21 per hour. That’s an extra £1,400 annually.
A list detailing these changes is below:
- Over-21s: £11.44 an hour to £12.21 an hour (6.7% increase)
- 18 to 20: £8.60 an hour to £10 an hour (16.3% increase)
- 16 to 17: £6.40 an hour to £7.55 an hour (18% increase)
- Apprentice: £6.40 an hour to £7.55 an hour (18% increase)
Following October announcement, Chancellor Rachel Reeves said: “This Government promised a genuine living wage for working people. This pay boost for millions of workers is a significant step towards delivering on that promise.”
Deputy Prime Minister Angela Rayner added: “A proper day’s work deserves a proper day’s pay. Our changes will see a pay boost that will help millions of lower earners to cover the essentials as well as providing the biggest increase for 18–20-year-olds on record.”
Are you being underpaid?
The Government encourages Brits to utilise its minimum wage calculator to verify if they are receiving the correct wage. To do this, you’ll need to provide details such as your age, pay frequency, working hours, wage amount and other factors.
Employees can also use this tool to determine if their employer owes them back payments from the previous year. There is a separate calculator available for employers who have concerns about potential underpayments.
