Employers who have employees paid at the National Living Wage (NLW) or National Minimum Wage (NMW) rates should be applying new rates of pay from 1 April 2021.
In full, the increases from April 1, 2021 are:
- NLW (23 ) has increased 2.2%, from £8.72 to £8.91
- NMW (21-22) has increased 2%, from £8.20 to £8.36
- NMW (18-20) has increased 1.7% from £6.45 to £6.56
- NMW (under 18) has increased 1.5% from £4.55 to £4.62
- Apprentice Rate has increased 3.6% from £4.15 to £4.30
In effect these changes mean that the 23-24 age category for the National Minimum Wage has been abolished, following the lowering of the age of the eligibility for the National Living Wage to 23 years old.
Employers should be aware that there are severe penalties if you fail to pay these NLW and NMW rates.
Currently penalties are:
- Any arrears of pay need to be repaid to employees.
- Penalties of up to 200% of arrears owed to employees may be charged.
- Maximum fines are presently set at £20,000 for each affected worker.
Obviously, it pays to be compliant…
