National Minimum Wage Increase
As confirmed in the Budget, the Government has accepted the Low Pay Commission’s (LPC) recommendations on the rates of the National Minimum Wage (NMW) in full, including the National Living Wage (NLW).
The LPC’s recommendations are based on extensive consultation with employers, workers, representatives of both groups and other expert bodies, as well as a series of regional visits across the UK. They reflect unanimous agreement among Commissioners, including those representing workers, employers and independent experts.
The rates which will apply from 1 April 2025 are as follows:
| National Living Wage | NMW Rate | Increase | Percentage increase |
|---|---|---|---|
| (21 and over) | £12.21 | £0.77 | 6.7 |
| 18-20 Year Old Rate | £10.00 | £1.40 | 16.3 |
| 16-17 Year Old Rate | £7.55 | £1.15 | 18.0 |
| Apprentice Rate | £7.55 | £1.15 | 18.0 |
Going forward, the recommended NLW rate is expected to equal two-thirds of median earnings and to have the highest real value in the history of the UK’s minimum wage. The increase in the 18-20 Year Old Rate, in particular, is intended to narrow the gap between the adult rate and 18-20 year olds in anticipation of abolishing the 18-20 year old banding in future years.
The recommended increase in the 16-17 Year Old Rate restores that rate to its original value relative to the adult minimum wage. In line with previous recommendations, the Apprentice Rate will remain equal to the 16-17 Year Old Rate.
