Changes to National Minimum Wage

Both the National Living Wage (NLW) for those 23 and over and National Minimum Wage (NMW) for those below the age of 23 increased on 1 April 2022.


The Treasury has implemented recommendations from the Low-Pay Commission to raise the minimum wage rates for under-23’s by 6.6% for 2022/23. Living wages increases are usually linked to the CPI’s rate of inflation for the previous September, which was 3.1%. The 6.6% increase is more than double the September rate.


From 1 April 2022, employers will have to pay at least the following hourly rates to workers in these age groups:



From 1 April 2022

From 1 April 2021

16 to 17-year-olds



18 to 20-year-olds



21 to 22-year-olds



Over 23s (NLW)







National Insurance Contributions (NICs) are also increasing in April by 1.25% to help fund social care. The following NICs rates will apply in 2022/23:


Class 1 (Employees)

13.25% (up from 12%)

Class 1 (Employers)

15.05% (up from 13.8%)

Above the upper-earnings limit

3.25% (up from 2%)


With the increase to the thresholds announced in the Spring Statement, from 6 July 2022 employees earning between £242 and £967 per week will pay NICs at 13.25%. Earnings over £967 will attract a 3.25% charge. Employers will pay 15.05% on their employee’s earnings over £175 per week.


This NIC increase will only apply for one year as from April 2023 a new Social Care Levy will be introduced. When this happens, employees will face an additional deduction from their pay, PAYE, NIC, Social Care Levy and any other deductions such as pensions.


For more information regarding NLW and payroll, please contact our payroll team on 01460 68700,