Reward Strategy



National Minimum Wage increases April 2017

At Budget 2016, the then chancellor announced that increases to the National Minimum Wage and National Living Wage would be aligned from April 2017

Twitter LinkedIn

This corrects the anomaly in 2016 that led to the National Living Wage being effective April 2016 and the National Minimum Wage being effective October 2016.


The National Minimum Wage (Amendment) Regulations 2017 are effective 1 April 2017 and amend the hourly rates as follows:

• Adult age 25+ to £7.50 (from £7.20). This is the National Living Wage
• Adult 21-24 to £7.05 (from £6.95)
• Youth Development 18-20 to £5.60 (from £5.55)
• 16-17 workers to £4.05 (from £4)
• Apprentice rate to £3.50 (from £3.40)
• Accommodation offset rate to £6.40 per day (from £6)


Note that the apprentice rate applies to apprentices under 19 and those aged 19 or over who are in their first year.

As to when the new rates are effective, there is no change in that regard and it’s all to do with when the pay reference period started and the age of the employee at the start of it. The new rates are effective for the first full pay reference period that starts on or after 1 April 2017. So, for example:

• A worker is paid monthly and is paid at the end of April for the period 1 to 30 April. She turns 25 on 2 April. The statutory obligation is for her to be paid at least £7.05 per hour for that pay reference period and she must be paid to £7.50 per hour from the start of the next pay reference period on 1 May.

• A worker is 25 and paid weekly on 7 April for the week that started 27 March and ended 2 April. To meet the statutory obligations, the employee must be paid at least £7.20 per hour on 07 April. The first full pay reference period on or after 1 April does not start until 03 April 2017. Therefore, the following week’s payment on the 14th must be paid at a rate of at least £7.50 per hour.


Of course, it is possible to pay the new rates from 1 April or from the time that a worker moves from one age band to another. This may mean having to do pro-rata calculations. However, there is no statutory obligation to do so. However, if the employer has always done this in previous years, it would probably be best to continue with this for fear of breaking a regime that has become custom and practice.

Twitter LinkedIn
Add New Comment

You might also like

The Reward 100 is evolving to the Reward 300

It’s time for The Reward 100, an index of the industry’s most important influencers and decision-makers, to become The Reward 300 and entries are now open for nominations

What are the real costs of payroll processes?

Tell us about your payroll processes for your chance to win a £200 Amazon voucher and VIP entry to the Reward Strategy conference in spring.

Employers Served Two Orders

Both employers and employees need to be aware of two orders that will amend the Employment Rights Act, and how this could affect them - but questions remain

Introducing The Payroll & Reward Conference

Reward Strategy is pleased to announce its partnership with The Learn Centre for The Payroll and Reward Conference 2018, taking place in London, June 6 to 7 2018

Bacs To The Future

If you’re a payroll professional, you’re probably scratching your head wondering why the rest of the world seems to be riding a technological juggernaut when it comes to payments, but in your work life, it’s more like a horse-drawn cart



Reward Strategy

Did you find our website useful?

Thank you for your input

Thank you for your feedback - an online news and information service for the UK’s payroll, reward, pensions, benefits and HR sectors. is published by Shard Financial Media Limited, registered in England & Wales as 5481132, Axe & Bottle Court, 70 Newcomen St, London, SE1 1YT. All rights reserved. Reward Strategy is committed to diversity in the workplace.
© Copyright Shard Financial Media Ltd