14th March 2014

The Countdown Begins as the National Minimum Wage is set to Rise…

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Employers will be required to pay new national minimum wage rates from 1 October 2014.

The Government has accepted the Low Pay Commission’s recommendations to increase the National Minimum wage and it will now be £6.50 per hour for the adult rate.  According to the Government, this will mean that more than one million people will see their pay rise by as much as £355 per year.  This will be welcome news for those employees who will benefit.

From 1 October 2014 the changes will be:

  • A 3% increase in the adult rate (from £6.31 to £6.50 per hour)
  • A 2% increase in the rate for 18-20 year olds (from £5.03 to £5.13 per hour)
  • A 2% increase in the rate for 16-17 year old (from £3.72 to £3.79 per hour)
  • A 2% increase in the rate for apprentices (from £2.68 to £2.73 per hour)

This is the first real-terms increase since 2008. The Low Pay Commission considers that 2014 will mark the start of a ‘new phase’ of ‘bigger increases than in recent years’. If economic conditions continue to improve there may be plans for bigger increase in the future.

Employers should begin to prepare for these wage increases and consider how the budget will cope with this change.

Cheryl Hogg
Trainee Solicitor 

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