National Wage Increase April 2024: Changes, Implications and Adaptations

From the 1^st of April 2024, national minimum wage rates are rising, and the national living wage threshold has been reduced. For business owners, implementing these changes could be influencing your strategic decisions in attempts to adapt.

In this blog post, we will discuss these changes and how they could impact your business.

We will also discuss how you can strategically manage adjustments without causing financial or commercial harm to your company.

The Changes:

• The National Living wage threshold has been lowered to age 21 (in reference to the Low Commission’s recommendations 2019).
• Apprentices aged 16-17 are entitled to be paid at least the apprentice wage rates as well as those who are aged 18-20 years if within in their first year of agreement
• Apprentices 19 years and over, or who have completed their first year of the agreement, are entitled to be paid the national minimum wage for their age
• Employees under 21 must be paid the national minimum for their age

New Hourly Rate and Resources

Aiding you with your assessments, there is a National Minimum / Living Wage calculator available for you to use.

The employer must pay the new national minimum. If failed to do so, they are at risk of being filed in their government report for not adhering to the law and being required to make any backdated and current repayments to their employees.

For more information, please visit The National Minimum Wage in 2024 guide or contact the ACAS helpline.

To have your say in future recommendations, participation in the Low Pay Commission UK regional visits is optional.

Implications

Positively, increased financial security for those affected will, in turn, increase their purchasing power which could potentially stimulate higher consumer spending for your business. Furthermore, this could motivate your employees and enhance their morale, leading to a more productive and engaged workforce.

Despite this benefit, businesses, especially those that are smaller, are experiencing the challenges of increased labour costs, as well as the rise in price of goods. Consequently, some businesses decide to increase their input prices. Overtime, this can influence customer satisfaction and loyalty to your brand. During this transitional period, it is important that you can protect your brand as much as possible while ensuring that your profitability remains at its highest level.

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Adaptions

Making big decisions such as whether to adjust your team, operational expenses, costs or prices can be difficult to manage during these changes to your budget. In these uncertain times, it is crucial to remain financially sustainable and morally ethical when maximising your profits; at MAD-HR, we are dedicated to helping you achieve that.

A great starting point we recommend is to focus on methods that can increase your efficiency and productivity levels. Optimising the resources you already have to their full potential or exploring alternative operational/structural strategies could significantly increase your profits, without needing to increase your prices as a result.

If you would like to Make A Difference and begin to employ these alterations to your practices, seeking our advice will be a fantastic investment for your business to gain cost-effective growth that will exceed your future forecasts.

Summary                                                                                                                                                          

As there are several employment law updates for 2024, it is important to be aware of these alterations and how they could influence your performance as a business currently and prospectively.

In accordance with these changes, handling these important decisions on changes with our specialist support can really Make A Difference. If you would like any advice from us, please feel free to reach out to our team today.