New minimum wage rates include increase for apprentices

The new National Minimum Wage rates include an increase for apprentices.

The Low Pay Commission (LPC) had recommended that the rate for apprentices should be frozen following concerns about compliance, but the Government has decided to go ahead and increase it.

Business Secretary Vince Cable said: “The independent Low Pay Commission plays a crucial role in advising the government when setting the National Minimum Wage every year. It balances wages of low paid workers against employment prospects if the rate was set too high.

“We are accepting its recommendations for the adult and youth National Minimum Wage rate increases, which I am confident strikes this balance. However, there is worrying evidence that a significant number of employers are not paying apprentices the relevant minimum wage rate.

“Apprenticeships are at the heart of our goal to support a stronger economy, and so it is important to continue to make them attractive to young people. Therefore, I am not taking forward the LPC’s recommendation to freeze the apprenticeship rate due to non-compliance, but instead am raising it in line with the youth rates. We are working on a series of tough new measures to ensure we tackle non-compliance issues across the board.”

The new rates are:

• The adult rate will increase by 12p to £6.31 an hour
• The rate for 18-20 year olds will increase by 5p to £5.03 an hour
• The rate for 16-17 year olds will increase by 4p to £3.72 an hour
• The apprentice rate will increase by 3p to £2.68 an hour.
• The accommodation offset increases from the current £4.82 to £4.91

The new rates come into effect on 1 October this year.

The Government says it will now work with employers, apprentices and training providers to improve awareness of rights and responsibilities on pay. At the same time it will be undertaking focused enforcement work to clamp down on non-compliance by employers.

Please contact John Carter or Robert Bedford if you would like information or advice about employment law issues.