New law: Living Wage and National Minimum Wage rates confirmed for April 2022

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 £9.50 per hour (previously £8.91).
• The national minimum wage rate for workers aged 21 to 22 increases to £9.18 per hour (previously £8.36).
• The rate for workers aged 18 to 20 increases to £6.83 per hour (previously £6.56).
• The rate for workers who are under 18 but above the compulsory school age (and not apprentices) increases to £4.81 per hour (previously £4.62).
• The apprentice rate for workers aged under 19 or in the first year of an apprenticeship also increases to £4.81 per hour (previously £4.30).
• 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 £8.70 per day (previously £8.36).

The large increase of 9.8% in the rate payable to 21-22 year olds is because the Low Pay Commission (LPC) has recommended that they should be paid the National Living Wage by 2024. The government's aim is therefore to phase increases in such a way as to avoid a single huge increase for them in 2024.

Operative date

• 1 April 2022

Recommendation

• Employers should budget and prepare for the new rates, from 1 April 2022.