New National Minimum Wage from 1 October 2016

As of 1 October 2016:

The national minimum wage will change on 1 October 2016 as follows:-

  • The rate for workers aged 21 to 24 rises to £6.95 per hour;
  • The development rate (workers aged 18 to 20) rises to £5.55 per hour;
  • The young workers rate (non-apprentices aged under 18 but above compulsory school age) rises to £4.00 per hour;
  • The apprenticeship rate rises £3.40 per hour;
  • The accommodation offset limit rises to £6.00 per day.

The national living wage, which took effect in April 2016, remains unchanged.  Going forward it is intended that the national minimum wage and the national living wage will be increased in tandem in April each year.

Still to come:

1.    The draft Equality Act (Gender Pay Gap Information) Regulations 2016 were intended to come into force in October 2016 with the first reports to be published by April 2018.  It has been announced that implementation has been delayed until April 2017, however it is believed the timescale for producing the first reports is unaffected.

2.    The Trade Union Bill received royal assent and became the Trade Union Act 2016 on 4 May 2016.  The Act will be brought into force by statutory instrument in due course.  It is not yet know what the commencement date will be.  Some of the key reforms introduced by the Act are:-

  • Employees providing essential public services can only take lawful industrial action if the vote has the backing of at least 40% of eligible Trade Union members, as opposed to just 50% of those who vote.
  • A requirement for clearer descriptions of the trade union dispute and the planned industrial action on the ballet paper; and
  • A requirement that notice of industrial action is doubled to 14 days unless the employer agrees to 7.

The ban on employers using agency staff to cover for striking employees has been kept in place.

3.         The legislation to introduce the apprenticeship levy is expected to come into force on 6 April 2017.  The levy will be on UK employers with an annual paybill in excess of £3 million to fund new apprenticeships.  Employers will be charged at 0.5% of their paybill. 

Posted on: 30/09/2016

This article is for general guidance only. It provides useful information in a concise form. Action should not be taken without obtaining specific legal advice.

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