From 1 April 2022, the rate of National Living Wage paid to workers aged 23 and over will rise by 6.6%, or 59p, to £9.50 an hour. Apprentices will benefit from an 11.9% uplift to their current hourly rate of National Minimum Wage.

For full-time workers, the 59p increase equates to extra annual salary of at least £1,000. Current and future rates of National Living/Minimum Wage are:

Apprentices receive the apprentice rate if they are either aged under 19 or in the first year of their apprenticeship. For example, a first-year apprentice aged 21 can be paid the apprentice rate.

The provision of accommodation is the only benefit that counts towards national minimum pay, with the maximum offset increasing to £8.70 a day (£60.90 a week).

Common misconceptions

HMRC has published a checklist of common causes of minimum wage underpayment:

• Making a wage deduction for something job-related, such as the provision of a staff uniform;
• Making a wage deduction where the employer benefits, such as employer-provided transport;
• Not paying for any additional time added on to a worker’s shift;
• Not paying for travelling time; or
• Not paying for any time spent training.

Real Living Wage

National Living/Minimum Wage rates should not be confused with the Real Living Wage. This is independently calculated to reflect the cost of living and can be paid by employers on a voluntary basis; nearly 9,000 employers do so.

The current Real Living Wage rate is £9.50 an hour, with a London rate of £10.85. It is aimed at all workers aged 18 or over.

HMRC’s checklist of common causes of minimum wage underpayment, along with links to detailed guidance, can be found here.