New law: Living Wage and National Minimum Wage rates confirmed for April 2021

The new living wage and national minimum wage rates for the various categories of worker are as follows:

• The living wage rate for workers aged 23 or over increases to £8.91 per hour (previously £8.72). Note the important change in 2021, that the living wage is available to those aged 23 and over, rather than 25 and over.
• The national minimum wage rate for workers aged 21 to 22 increases to £8.36 per hour (previously £8.20).
• The rate for workers aged 18 to 20 increases to £6.56 per hour (previously £6.45).
• The rate for workers who are under 18 but above the compulsory school age (and not apprentices) increases to £4.62 per hour (previously £4.55).
• The apprentice rate for workers aged under 19 or in the first year of an apprenticeship increases from to £4.30 per hour (previously £4.15).
• The accommodation offset (the maximum daily amount an employer can take into account when calculating whether NMW has been paid, where accommodation is provided to a worker) increases to £8.36 per day (previously £8.20).

Operative date

• 1 April 2021

Recommendation

• Employers should budget and prepare for the new rates, taking into account the new age bands, from 1 April 2021.