Two pieces of legislation came into force on 01 April 2024:
1. The National Minimum Wage (Amendment) Regulations 2024
2. The National Minimum Wage (Amendment) (No. 2) Regulations 2024
Whilst the details have been outlined on Wages Wednesdays presentations, it is worth outlining all the changes that this legislation will give employers (and bookkeepers that process client payrolls):
The Original 2024 Regulations
The effect of these Regulations is to amend the ‘live-in domestic worker exemption’. This says that where a domestic worker lives with the family and is treated as part of the family, even though they are a worker, they do not have to be paid the National Minimum / Living Wage. Commonly, this will apply to au pairs, companions, chauffeurs, chefs, nannies etc.
If you have any clients with live-in domestics on the payroll, be aware they will be bought into scope of the National Minimum / Living Wage for pay periods that start on and after 01 April 2024. The live-in domestic worker exemption’ will only apply where the worker is:
- A member of the employer’s family, and
- They reside in the family home of the employer, and
- They share in the tasks and activities of the family
The No.2 2024 Regulations
These have two purposes which employers and bookkeepers need to be aware of.
In the first instance, the applicable age at which the National Living Wage is payable reduces from 23 to 21. At the point the workers turns 21, from the start of the next full pay reference period, they must move from being paid at the National Minimum Wage to payment at the National Living Wage.
Secondly, for pay reference periods that start on an after 01 April 2024, the rates are increased as follows:
|
Rate
|
From April 2023
|
From April 2024
|
Change
|
Change
|
|
|
£
|
£
|
%
|
£
|
|
Adults (21+) aka the National Living Wage
|
10.42
|
11.44
|
9.8
|
1.02
|
|
Adult (21 – 22) - now the National Living Wage
|
10.18
|
N/A
|
12.4
|
1.26
|
|
Youth Development (18 – 20)
|
7.49
|
8.60
|
14.8
|
1.11
|
|
Under 18 (above compulsory school leaving age)
|
5.28
|
6.40
|
21.2
|
1.12
|
|
Apprentice rate
|
5.28
|
6.40
|
21.2
|
1.12
|
The Accommodation Offset daily rate increases by 9.8% from £9.10 to £9.99.
For Bookkeepers
More changes than usual to become familiar with:
1. The live-in worker exemption is amended, bringing into scope workers such as chefs, nannies, au pairs who may live with the family
2. The National Living Wage is extended to workers aged 21 and over (from 23 and over)
3. The rates increase
Software should do much of the work, especially regarding points 2 and 3 – though check your software updates for 2024/25. With regards point 1, if you have such people on your payroll and they are not being paid the National Minimum or Living Wage appropriate to their age, for pay reference periods on and after 01 April 2024, ensure that these workers are bought into scope of compliance.
