New national minimum wage rates announced

In his Autumn Budget, the Chancellor confirmed the national minimum wage increases which will take effect from April 2018. Also, a new scheme has been announced affecting care sector employers who may have underpaid their workers.

In case law, we have seen conflicting gig economy employment status judgments involving Uber and Deliveroo and a timely Bill has been published to offer further protection to these atypical workers.

New national minimum wage rates

As part of the Autumn Budget, Chancellor Philip Hammond confirmed the new minimum rates of pay which will apply from April 2018.

In line with the intention for the national living wage to increase to £9 per hour from 2020, it will increase from £7.50 to £7.83, representing a 4.4 per cent uplift. In practical terms, this will mean a pay rise of around £600 per year for a full time worker.

The other rates will increase as follows:

  • Workers aged 21-24: from £7.05 to £7.38 an hour
  • Workers aged 18-20: from £5.60 to £5.90 an hour
  • Workers aged 16-17: from £4.05 to £4.20 an hour
  • Apprentice rate: from £3.50 to £3.70 per hour

The Budget was also used to announce a review of the flexibility of the way organisations may use their apprenticeship levy (large organisations have been required to pay this levy since April 2017 which they can then use to fund apprenticeships) and a National Retraining Scheme to support worker’s career development.