Millions of British workers are set for a significant pay rise this year, following Labour’s Autumn Budget announcement. Chancellor Rachel Reeves confirmed an increase in the National Living Wage and the National Minimum Wage last autumn, aiming to promote fairer salaries.
The National Living Wage is a higher rate mandatory for those over 21, while the National Minimum Wage is the lowest legal hourly pay for workers. However, it’s important to note that not all job types are entitled to this minimum pay – including a surprising 15 roles.
It might come as a shock to know that company directors, university students on work placements, and even members of the Armed Forces are not guaranteed the basic amount. The Government also lists the following:
- Company directors
- Workers on a government employment programme, such as the Work Programme
- People working on a Jobcentre Plus Work trial for up to 6 weeks
- Self-employed people running their own business
- Share fishermen
- Workers on government pre-apprenticeships schemes
- People living and working in a religious community
- People who are volunteers or voluntary workers
- Members of the Armed Forces
- Family members of the employer living in the employer’s home
- Workers younger than school leaving age (usually 16)
- People shadowing others at work
- Prisoners
- People on the following European Union (EU) programmes: Leonardo da Vinci, Erasmus+, Comenius
- Higher and further education students on work experience or a work placement up to one year
The wage changes, due to be implemented on April 1, 2025, are expected to affect more than three million employees. Apprentices and those aged 16 to 17 will see the largest minimum pay increase from £6.40 to £7.55 an hour, worth 18%. Eighteen to 20 year olds will also benefit from a record rate increase, with their minimum wage rising to £10 per hour.
The final group includes those over 21, who will receive a 6.7% pay increase worth 77p, bringing the National Living Wage to £12.21 per hour – an extra £1,400 annually.
A comprehensive list detailing these changes is below:
- Over-21s: £11.44 an hour to £12.21 an hour (6.7% increase)
- 18 to 20: £8.60 an hour to £10 an hour (16.3% increase)
- 16 to 17: £6.40 an hour to £7.55 an hour (18% increase)
- Apprentice: £6.40 an hour to £7.55 an hour (18% increase)
Following the announcement in October, Chancellor Rachel Reeves stated: “This Government promised a genuine living wage for working people. This pay boost for millions of workers is a significant step towards delivering on that promise.”
Deputy Prime Minister Angela Rayner added: “A proper day’s work deserves a proper day’s pay. Our changes will see a pay boost that will help millions of lower earners to cover the essentials as well as providing the biggest increase for 18–20-year-olds on record.”
Are you being underpaid?
The Government is encouraging Brits to use its minimum wage calculator to check if they are being paid correctly. To use it, details such as age, pay frequency, working hours, wage amount and other factors need to be provided.
Employees can also use this tool to find out if their employer owes them back payments from the previous year. A separate calculator is available for employers who have concerns about potential underpayments.