The National Minimum Wage (NMW) is set to rise again in April 2025, meaning businesses across the UK will need to prepare for the impact on their payroll. Here’s a quick guide to help you navigate the increases and how EKW Group can help.
What’s Changing?
- From April 1 2025, the following NMW changes will come into effect:
- National Living Wage (21+) will increase by 6.73% to £12.21
- National Minimum Wage (18-20) will increase by 16.28% to £10.00
- National Minimum Wage (under 18 & apprentices) will increase by 17.97% to £7.55
- Daily accommodation offset will increase by 6.71% to £10.66
How to Prepare for the Changes
Review Employee Contracts
Update all employee contracts to reflect the new NMW rates for 2025, particularly for those on hourly or part time contracts. Make sure to adjust any salaries that fall below the new rates, ensuring everyone is paid fairly and on time.
Prepare Your Payroll System
Make sure your payroll software is fully updated to handle the new NMW rates. This includes ensuring the system reflects the correct pay rates for different employee categories, such as age groups and apprentices.
Communicate with Employees
Keep your team in the loop about the upcoming NMW increase—let them know how it will impact their pay and any changes they can expect. If your employees receive additional benefits like bonuses or commissions, be sure to factor these in to ensure everything aligns with the new rates.
Ensure Compliance
Failing to meet the new NMW requirements can result in hefty fines—up to 200% of the underpaid amount, capped at £20,000 per worker. Repeat offenders may be publicly named by the government, and employees could file tribunal claims for back pay or compensation, leading to both financial and reputational damage. This means that taking all the above steps in advance is crucial.
How we can help
If you require support in implementing these changes, EKW Group’s comprehensive payroll services can help to ensure a smooth transition to the new NMW rates. With our expertise, you can stay on top of the changes and maintain compliance without the stress.
If you would benefit from more detailed guidance, please don’t hesitate to get in touch with a member of our team on 01942 816512 or email:
Kirsten Croston, Payroll Manager: [email protected]
