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Minimum wage increases

The adult rate of the national minimum wage (NMW) is set to rise by 20p to £6.70 on 1 October 2015.

As well as the change to adult rate:

  • the apprentice rate increases by 57p to £3.30
  • the rate for 18 to 20 year olds will rise by 17p to £5.30
  • those aged 16-17 will now be paid £3.87, an increase of 8p
  • the accommodation offset will rise from £5.08 to £5.35.

Figures released in 2014 by the Low Pay Commission show that the hospitality, retail and cleaning sectors accounted for 52% of NMW jobs. Small businesses contained 37% of workers who were paid the NMW.

The increase is the largest real-terms rise since 2007, and the government estimates that 1.4 million workers stand to benefit.

John Allan, national chairman for the Federation of Small Businesses, said:

“As well as focusing on enforcement, the government must clearly and proactively communicate the change to employers – ensuring businesses fully understand what they need to do and when. This support and guidance is necessary so small businesses avoid inadvertently falling foul of the law.”

Preparing for a NMW rise

Businesses that are concerned about the effects of a rise in the NMW, can take the following steps:

  • use the government’s pay and work rights helpline or the ACAS online tools and guidance
  • reassess your outgoings and prices to balance the increase in your wage bill
  • join a relevant business body
  • review your payroll to ensure compliance and all of the employee information (especially ages) is correct.

Discuss your employer obligations with a member of our team today.