Minimum Wage Increases – What Employers Need to Know for April 2024

The Government has confirmed that the National Minimum Wage and National Living Wage rates will rise from April 2024. While this may not impact every employer, it’s important to understand the new rates.

Planning ahead will ensure you remain compliant and can budget accurately for any increased payroll costs.

Step 1: Understand the New Minimum Wage Rates

From April 2024, the following rates will apply:

• Over 21s (National Living Wage): Increasing from £10.18 to £11.44 per hour.

• 18 – 20 year olds: Increasing from £7.49 to £8.60 per hour.

• 16 – 17 year olds: Increasing from £5.28 to £6.40 per hour.

• Apprentices: Increasing from £5.28 to £6.40 per hour.

Step 2: Review Which Employees Are Affected

It’s not just hourly workers you need to consider. Salaried employees must also be reviewed to ensure their pay meets the new legal thresholds.

For example:

• A 40-hour week currently equates to an annual minimum salary of £21,174.40

• From April 2024, the same hours will require a minimum salary of £23,795.20

Check all employees — especially those on lower salaries — to avoid unintentional underpayment.

Step 3: Budget for the Impact

Even if you don’t employ staff at current minimum wage levels, these increases may have a knock-on effect across your pay structure you may want to consider:

• Compression issues: Where employees on higher rates may expect pay adjustments to maintain differentiation.

• Overtime and shift allowances: Will increased basic rates affect these calculations?

• Budget forecasting: Factor in higher payroll costs for the new financial year.

Planning now gives you time to make informed decisions and communicate any changes clearly to your team.

Step 4: Prepare Your Policies and Communications

• Update your payroll system in time for April 2024.

• Review and update contracts and pay policies where necessary.

• Communicate changes to affected staff in a clear and positive way.

• Keep an eye on Government updates, as further movement towards a single adult rate may follow.

How Kirby HR Consultancy Can Support You

We can help you prepare for these changes by:

• Reviewing your pay structures and identifying impacted roles.

• Advising on contract updates and policy changes.

• Supporting you with employee communications to ensure clarity and transparency.

• Helping you plan for longer-term pay strategies as rates continue to evolve.

Need Advice on Minimum Wage Changes?

If you’d like tailored support to review your pay structures and ensure compliance ahead of April 2024, contact Kirby HR Consultancy:

07889053608[Insertemaillink] [Insert contact form link]