On 1st April 2025, the United Kingdom introduced significant increases to the National Minimum Wage (NMW) and National Living Wage (NLW), a key step in boosting earnings for millions and addressing the continued rise in living costs.
KEY CHANGES EFFECTIVE FROM 1ST APRIL 2025
- National Living Wage (21+):
Increased by 6.7%, from £11.44 to £12.21 per hour.
For full-time employees (37.5 hours/week), this equates to an annual pay rise of approximately £1,505.54.
- 18–20 Year Old Rate:
Rose by 16.3%, from £8.60 to £10.00 per hour.
- 16–17 Year Old Rate & Apprentice Rate:
Both increased by 18.0%, from £6.70 to £7.55 per hour.
These changes form part of the government’s wider strategy to align wages with inflation and ensure earnings better reflect the cost of living. Over three million workers, including around one million in the hospitality and retail sectors, stand to benefit.
CONTEXT MATTERS
While these increases offer welcome support, they coincide with rising household expenses including council tax, energy, and water bills, which may offset some of the financial gains for workers.
EMPLOYER RESPONSIBILITIES
Businesses must ensure compliance with the updated rates to avoid legal penalties and potential reputational damage through public naming. It’s also a good time to revisit payroll systems, budget forecasts, and HR strategies.
LOOKING AHEAD
As wage expectations evolve, employers should consider how they attract and retain talent in an increasingly competitive job market.
For further help and guidance on understanding the changes and the various business aspects employers should consider, get in touch with a member of our team at hello@hellochief.co.uk.
