National Minimum Wage
Raise National Minimum Wage Rates By Removing the Age Bands
Labour intends to remove the age bands from the National Minimum Wage to create one single hourly rate for all workers. The remaining rate will be the current Adult Worker Rate i.e. for those aged 21 and over. They are also committed to changing the Low Pay Commissions remit to ensure that their annual recommendations for increases to the National Minimum Wage rate(s) take account of the cost of living.
Proposed Changes
This page was first published on 21 August 2024, updates will be made as more information is released.
Labour intends to remove the age bands for workers aged 16-17 and 18-20; leaving the 21+ rate as the single hourly rate regardless of age and creating a single minimum rate per hour for all workers. The remit of the Low Pay Commission will also be changed to ensure the cost of living is taken into account when recommending annual increases to the National Minimum Wage Rate(s).
Timescales
These changes may be implemented relatively quickly because neither change requires primary legislation.
The Low Pay Commission makes their recommendations for increasing the rate of NMW in October and the new rate take effect the following April. Labour could set the Commission’s new remit immediately so the April 2025 increase to the NMW takes account of the cost of living.
The age bands could be removed at the same time, but as this would have a significant effect on businesses who employ younger workers it could be delayed or phased in to give businesses time to prepare.
Top Tips
This could have significant impact on employers who have large numbers of workers in the 18-20 age bracket (retail, leisure and hospitality sectors). In the short-term audit your workforce to help anticipate how the change to a single hourly rate may impact your business.
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