National minimum wage rates change April 2023

From 1 April 2023, the following increases to NMW/NLW will come into force:

National living wageRate from April 2023Rate from April 2022Increase %
23 years old plus£10.42£9.509.7
21-22 year old rate£10.18£9.1810.9
18-20 year old rate£7.49£6.839.7
16-17 year old rate£5.28£4.819.7
Apprentice rate£5.28£4.819.7

The increases apply in the next ‘pay reference period’ after the increase. For example, if X gets paid on the 15th of the month, the old rate applies until the 15th, and the new one from the 16th. To avoid misunderstandings, you might want to explain this to your staff.

Falling foul of the law

The consequences of failing to pay NMW/NLW can be costly:

  • fines at 200% of arrears (reduced to 100% if paid within 14 days, subject to a maximum of £20,000 per unpaid worker);
  • repayment of arrears, calculated at the current rate of NMW/NLW;
  • criminal proceedings for the most serious breaches.

Common mistakes

Keeping up with entitlement

16% of those publicly ‘named and shamed’ by the government for breaching the NMW/NLW blamed failing to increase pay in line with entitlement. You should therefore be careful to keep on top of employee birthdays.

If you employ apprentices, that rate is only paid in the first year; thereafter, only to those under 19. Your should be aware of when they:

  • move into year two (if 19 and over);
  • turn 19 (after year one); and
  • finish their apprenticeship.

These events mean they must be paid the appropriate NMW/NLW rate from the next ‘pay period’.