National Minimum Wage hike to hit your business

  • Pay & Benefits
James Potts - Legal Services Director at Peninsula

James Potts, Legal Services Director

(Last updated )

The government has announced new National Minimum Wage and National Living Wage rates—promising the “biggest cash increase ever” for UK workers.

Here’s what the new rates mean for you.

Pay rises across the board

From the 1st April 2020, you need to give any worker on the National Living Wage or the National Minimum Wage a pay rise. 

Here’s the breakdown of the new rates:  

  •  £8.72 per hour for workers aged 25 and over (up from £8.21 per hour) 
  •  £8.20 per hour for workers aged 21 to 24 (up from £7.70 per hour)
  • £6.45 per hour for workers aged 18 to 20 (up from £6.15 per hour)
  • £4.55 per hour for workers aged under 18 (up from £4.35 per hour)
  • £4.15 for apprentices aged under 19 (up from £3.90)

The minimum rate of pay varies for apprentices aged 19 and over. After the first year of apprenticeship, you need to increase your apprentice’s pay to the National Minimum Wage for their age group or the National Living Wage if they’re aged 25 or over.

Prepare your payroll for April

Whatever category your worker falls into, you need to prepare your payroll to meet the new rates in time for April.

That means making sure you give staff the right wage for their age category, and keeping track of when workers move into a higher paid age group.   

It’s important to pay the right wage. Every year, HMRC catches hundreds of businesses for paying below the minimum rates of pay and forces them to pay out thousands of pounds.

Remember, the minimum wage increase is just one of the major employment law changes to hit businesses in April 2020.

Statutory Sick Pay is set to go up to £95.85 per week and the new rate for Statutory Maternity, Paternity, Adoption and Shared Parental Pay is set to rise to £151.20 per week.

And that’s just the start…

The Good Work Plan hits

Several ‘Good Work Plan’ laws come into force in April, in what some are calling “the largest upgrade to workers’ rights in a generation”.

And with good reason.

The Good Work Plan introduces fundamental changes to how you manage staff. These range from how you issue contracts to how you calculate holiday pay for certain workers.

It also provides workers with more rights, such as preventing the use of contracts that can deny agency workers equal pay.

You can read more about the Good Work Plan changes in detail here. But for the moment, all you need to know is there are a lot of new employment laws that affect your business. Fortunately, there’s still time to prepare.

Prepare now to prevent worry later

If you’re a Peninsula client, contact the 24/7 HR and employment law advice line today.

We talk you through the new minimum wage rates and help make sure that you’re ready for every April legal change.  

Plus, we provide expert advice on how to keep staff costs under control. This includes helping to create contracts and policies that give you flexibility in staff working hours and help reduce overheads.

And if you’re not a Peninsula client, don’t worry. You can still get a free advice call to help you meet the new laws and keep your business safe. Call 0800 051 3638.

Related articles

  • tribunal

    Blog

    HMRC refuses to stand down on £470k giant marshmallows case

    After losing a £470,000 VAT case at the Upper Tribunal over whether giant marshmallows are confectionery, HMRC is taking the fight to the Court of Appeal

    Peninsula TeamPeninsula Team
    • Employment Tribunal
  • working

    Blog

    Employers asked what help is most needed to get people back into work

    With the Government considering a number of welfare-to-work reforms, the Recruitment and Employment Confederation (REC) decided to ask employers for their views on what is most needed in order to find, recruit and retain the right people.

    Peninsula TeamPeninsula Team
    • Employment Contract
  • staff rates falling

    Blog

    April sees staff rates falling but pay growth on the up

    The latest KPMG and Recruitment and Employment Confederation (REC) report on UK jobs has found the number of workplaces is still slowly dropping while salaries are increasing

    Peninsula TeamPeninsula Team
    • Pay & Benefits
Back to resource hub

Try Brainbox for free today

When AI meets 40 years of Peninsula expertise... you get instant, expert answers to your HR and Health & Safety questions

Sign up to our newsletter

Get the latest news & tips that matter most to your business in our monthly newsletter.