Both employers and employees need to be aware that there are some big changes happening to the Minimum Wage from 1st of April 2024.
The National Minimum Wage was brought into Statutory Force from 1999 and is updated annually on April Fools Day.
This year’s amendments will see both the greatest increase and the reduction of the adult pay rate age bracket down from 23 years old to 21 Years old. This major shift is seen as an acknowledgement of the Cost of Living Crisis and In-Work Poverty. While it is right and fair, it will inevituably have a major impact on wage bills.
The National Minimum Wage is designed to maintain fair pay for work of equal value in the workforce for all workers over 16. Failure to comply can result in significant fines, inclusion on a name-and-shame Government open list and tribunal claims.
Any arrears have to be paid at the current rates, and the maximum fine award is £20,000 per employee.
Employer actions:
Check which employees are aged 21 and 22 on 1st April
Check which employees turn 21 after 1st April
Write amend pay letters to inform of age and band change/pay amendment
Amend pay from the next payment after the age/change requirement.
There is one further change.
The Domestic Worker exemption (someone who lives with you and your family but has a paid role) is now abolished. So all individuals need to now be paid the National Minimum Wage. This took effect from 23rd January this year.
Sally Cooper HR Consultant, Member of the CIPD
