National Mimimum Wage and National Living Wage

National Mimimum Wage and National Living Wage

The National Minimum Wage was introduced in April 1999 to set the minimum hourly rate that an employer can pay an employee. This is still in place for workers under the age of 25, but from 1st April 2016, a new minimum rate, the National Living Wage, applies if the employee is aged 25 and above.

Employees are legally entitled to receive the National Minimum Wage or, if they are aged 25 plus, the National Living Wage.

Both rates are reviewed and increased each year. The rates for the 2019/20 tax year are:

Real Living wage (and London Living Wage)

The ‘national living wage’ is paid at the same rate for the whole country with no allowance for the higher costs of living in the capital. The Real Living Wage, on the other hand, is independently calculated, voluntary and based on the cost of living. The Real Living Wage has different rates for London and the rest of the country, recognising the higher costs of living in London.

The London Living Wage rate is £10.55 per hour

The rate for the rest of the UK is £9.00 per hour. Some London Boroughs have signed up to the ‘Living Wage’ so please check with your local authority to see if this applies to your employees.

Contact us

Contact the payroll team by completing the Contact Us form on our website or use the Livechat below.