Massey Accounting Company

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National Living Wage to replace National Minimum Wage from April 2016

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The National Living Wage of £7.20 per hour will become the new minimum pay rate for those aged 25 and over starting 1 April 2016.

Slightly confusingly the two terms National Minimum Wage (NMW) and National Living Wage (NLW) will now run in tandem but basically:

If your employees are aged 25 and over they will be entitled to the £7.20 National Living Wage.

Under 25 years old and they will be entitled to the National Minimum Wage of £6.70. Although there are lower rates for those under 21 or on an apprentice scheme. See our post regarding NMW for more details.

It seems that the change needs highlighting because we’ve become accustomed to the NMW rise on 1 October each year. But on 1 April 2016 many of your employees will be entitled to their second pay rise in 6 months. Please be sure to plan for the additional costs and adjust your payroll settings accordingly.

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