How does the Spring Budget impact National Minimum Wage (NMW)?

The Spring Budget did not announce anything new on National Living (NLW) or Minimum Wage (NMW).

Therefore, the NLW is still set to increase to £10.42 from April 2023 (a 9.7% increase currently payable to those aged 23 and over) and a higher increase (10.9% to £10.18) to the NMW for 21–22-year-olds in preparation for extending the NLW wage to this age range by 2024. Full rates can be accessed here.

Low Pay Commission report recommendations

It is important to be aware that the Low Pay Commission did make some interesting recommendations and observations in their recent annual report which include: -

Intention to review the policy framework around the accommodation off-set and their future approach to making recommendations on the off-set rates.
An Apprentice Evaluation Survey to be undertaken in 2024 to evaluate the need for a separate apprentice rate.
Seafarers to be exempt from the accommodation off-set being applied as they are confined to their work premises and required to be available in case of an emergency.
Strengthening legislation to limit the use of zero-hours contracts, prevent the bogus classification of workers as ‘self-employed’ and to extend employment rights.
A focus on geographical areas of low paying sectors – social care and zero hours in Scotland, hospitality and food production in Wales and traditionally deprived areas such as the North East, North West, East Midlands, and West Midlands.

Increased HMRC enforcement activity can be expected off the back of some of the above recommendations. The full report can be found here.