Young Workers To Get Pay Boost - National Living Wage For 18 To 20-year-olds To Be Phased In

31st July 2024

The government is committed to ensuring that every adult worker benefits from this genuine living wage, and we will remove discriminatory age bands for adults.

In the interim, we ask that the Low Pay Commission recommends a National Minimum Wage rate that should apply to 18 to 20-year-olds from April 2025. This should continue to narrow the gap with the National Living Wage, taking steps year by year in order to achieve a single adult rate. This ambition should be pursued while also taking into account the effects on employment of younger workers, incentives for them to remain in training or education and the wider economy.

The government also asks the Low Pay Commission to monitor and evaluate the levels of the other National Minimum Wage rates (under 18 and apprentice rates) and make recommendations on the increases it believes should apply from April 2025 so that the rates are set as high as possible without damaging the employment prospects of each group.

In addition, we ask the Low Pay Commission to recommend the accommodation offset rate that should apply from April 2025.

An extension of the national living wage to all adults should be phased in "year by year" and the NLW rate should rise at least in line with median earnings after the government updated the Low Pay Commission's remit.

In a written statement to Parliament, business secretary Jonathan Reynolds said he had written to LPC chair Baroness Stroud to set out an updated remit, which asks the commission to consider the cost of living for the first time, while also considering the impact on business, the labour market and the wider economy.

But the government has chosen what has been described as a "one-year holding position" for the 2025 national living wage (NLW) - the rate for people aged 21 and over - after the government asked the LPC to preserve its value relative to typical wages.

The remit says the LPC should ensure the rate does not drop below two-thirds of UK median earnings for workers aged 21 and over, a recognised measure of low hourly pay.