The Government have announced changes to the way the Minimum Wage is set, which are included in the Low Pay Commission (LPC)’s remit for making recommendations for rates from April 2025.
The LPC is asked to:
- Factor in the cost of living, including the expected annual trends in inflation between now and March 2026, when deciding rates, a commitment made in Labour's Plan to Make Work Pay.
- Recommend a National Minimum Wage rate that should apply to 18 to 20-year-olds, which continues to narrow the gap with the National Living Wage, taking steps year by year in order to achieve a single adult rate.
- Monitor and evaluate the levels of the under 18 and apprentice rates and make recommendations, so that the rates are set as high as possible without damaging the employment prospects of each group.
- Recommend the accommodation offset rate that should apply from April 2025.
- Continue to consider the impact on business, competitiveness, the labour market and the wider economy, in making its recommendations.
The LPC is due to report back to Government by the end of October 2024, on rates that take effect from April 2025.
