A new pay rule is now appearing in payslips across the country, having taken effect back in April. Under the Labour Party government, the National Living Wage has been increased by 4.1% to £12.71 an hour for eligible workers aged 21 and over.
Full-time workers on the National Living Wage will see a rise of £900 a year, while full-time workers on the 18-20 National Minimum Wage rate will receive a £1,500 increase.
Davidson Morris, a legal firm, stated: "From April 2026, employers will need to apply higher statutory payment rates and new National Minimum Wage levels across payroll, HR systems and employment documentation. The changes affect statutory sick pay, family-related statutory payments, earnings thresholds and hourly wage rates, with different implementation dates across April."
The firm added: "These updates have cost, compliance and system implications, particularly for employers with large workforces, variable hours staff or workers paid close to statutory thresholds."
Changes for Younger Workers
From April, the National Living Wage rate for 18–20-year-olds also increased by 8.5% to £10.85 per hour, narrowing the gap with the NLW. This change marks further progress towards the government’s goal of phasing out 18-20 wage bands and establishing a single adult rate.
The National Minimum Wage for 16–17-year-olds and those on apprenticeships has increased by 6% to £8 per hour.
Government Statement
The government said: "By seeking expert and independent advice, we are able to ensure that the right balance is struck between the needs of workers, the affordability for businesses and the opportunities for employment."
It added: "We are a pro-business government that has capped Corporation Tax at 25%, the lowest rate in the G7, we’re reforming business rates, have secured trade deals with the US, EU and India, and have seen interest rates cut five times since the election, benefiting businesses in every part of Britain."
