The national minimum wage has been raised for over 25s from £6.70 to £7.20; whilst it has remained £6.70 for those aged 21 to 24. This new wage has been named the National Living Wage.

It was introduced by the government so that those working at a minimum wage could afford a high enough standard of living, as well as being able to afford everyday things such as food, transport and bills. 

Whilst the new national living wage has replaced the minimum wage for 25 and overs; the regular minimum wage remains in place for those younger than 25. The actual wage itself still varies, 21-24 it’s £6.70, 18-20 it’s £5.30, under 18 it’s £3.87 and you would only be entitled to the national living wage once you have turned 25.

There is a substantial effect on employers; supposing a number of their workers are 25 and over. This increase in wage could mean that many companies would have to let go of employees, as they cannot afford to employ their full force at this larger amount. The office for budget responsibility predicts that 60,000 people could lose their jobs as a result, or companies would be forced into employing younger workers that they can afford.

This is not to be confused with the existing living wage, which is set at £8.25 for the UK with a slight increase – £9.40 for those living in London.

Employers may be concerned given that they have to increase the wage package, but the government has promised to help businesses to afford this change. Corporation tax is being cut by 3% by 2020 and employers will be able to reduce the number of national insurance contributions they pay for their employees by 50%.

Need any more information?

If you wish to know more about the National Living Wage, contact us by email at This email address is being protected from spambots. You need JavaScript enabled to view it. or call 01623 490 120.