The new National Minimum Wage rate rises to £6.50 an hour from £6.31.
More than 1 million Britons currently on the National Minimum Wage (NMW) are set to benefit from an increase in NMW which is coming into force today, the 1st October 2014.
Following the recommendations from the independent Low Pay Commission (LPC) in March 2014, the new rate of £6.50 per hour is the first real terms cash increase since 2008.
Starting from the 1st October 2014, the National Minimum Wage rates are as follows:
- a 19p (3%) increase in the adult rate (from £6.31 to £6.50 per hour)
- a 10p (2%) increase in the rate for 18 to 20-year-olds (from £5.03 to £5.13 per hour)
- a 7p (2%) increase in the rate for 16 to 17-year-olds (from £3.72 to £3.79 per hour)
- a 5p (2%) increase in the rate for apprentices (from £2.68 to £2.73 per hour)
What the changes in National Minimum Wage means for you
If you are an employer that employs staff on NMW, it is imperative that the new rates of pay are applied for your workforce. Failure to do so could potentially incur penalties.
If you are an employee on NMW, your pay should automatically be increased. If you are unsure, contact your line manager or check your pay slips to see that the new rate is being applied.
The changes to National Minimum Wage have widely been praised, although some industry experts have said that the increase is still not enough. Vince Cable, Business Secretary, pushed through the changes and had this to say: “The National Minimum Wage provides a vital safety net for the lowest paid, ensuring they get a fair wage whilst not costing jobs. This year’s rise will mean that they will enjoy the biggest cash increase in their take home pay since the banking crisis, benefiting over 1 million people in total.”
If you have any questions about the new rate of NMW and how it affects you, give us a call on 01223 855440.