|Age||Rate from 1 October 2015||Rate from 1 April 2016||Rate from 1 October 2016|
|Workers aged 25 and over (NLW)||n/a||£7.20 an hour||£7.20 an hour|
|Workers aged 21 and over||£6.70 an hour||£6.70 an hour||£6.95 an hour|
|Development rate for workers aged 18-20||£5.30 an hour||£5.30 an hour||£5.55 an hour|
|Young workers rate for workers aged 16-17||£3.87 an hour||£3.87 an hour||£4.00 an hour|
|Apprentices under 19, or over 19 and in the first year of the apprenticeship||£3.30 an hour||£3.30 an hour||£3.40 an hour|
- All workers, except those who are genuinely self-employed, are entitled to receive the NMW/NLW
- Gross pay is used to calculate whether an eligible worker has been paid the minimum wage
- The NMW/NLW is calculated by including most financial awards or payments, but excluding allowances such as regional or on-call allowances, unsocial hours payments, tips and gratuities, or any benefits in kind, with the exception of accommodation up to a specified amount
- Employers can average the hourly rate of pay over the pay period
- Non-compliance can result in an enforcement notice requiring the employer to pay the difference between what was actually paid and what the worker should have received under the NMW legislation. Further non-compliance could result in the issue of a penalty notice and financial penalties.
|National minimum wage and National living wage|
The new National Living Wage (NLW) for workers aged 25 and over, set at £7.20 (the over-21 NMW rate plus a premium of 50p), applies from 1 April 2016. The government expects the rate to rise to over £9 by 2020 (a government policy paper explains the thinking behind the NLW).
The government has announced increases to the National Minimum Wage rates to take effect from 1 October 2016. From 2017, increases to both the NLW and NMW will take place in April.
The Low Pay Commission, which advises the government on the NMW rate, has been asked to recommend appropriate levels for both the NMW and the NLW (see NMW: Low Pay Commission remit 2016).