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Following on from recommendations made by the Low Pay Commission (LPC), the National Minimum Wage will increase from today – 1 October 2016.

The Government announced no increase in the rate for over 25 year-olds (which remains at £7.20 per hour); an increase in the rate for 21 to 24 year-olds of 25p (from £6.70 to £6.95 per hour); an increase in the rate for 18 to 20-year-olds of 25p (from £5.30 to £5.55 per hour); a 13p increase in the rate for 16 to 17-year-olds (from £3.87 to £4 per hour) and a 10p increase in the rate for apprentices (from £3.30 to £3.40 per hour).

However, not all workers qualify for the national minimum wage. It is important to distinguish the difference between apprentices and standard employees. An apprentice is an individual aged 16 to 18 (and aged 19 or over who are in their first year of their apprenticeship). Apprentices qualify for the apprentice minimum wage, and not the standard worker minimum wage. All apprentices aged 19 and over and in the second year of their apprenticeship qualify for the standard national minimum wage rates for their age.

Employees who qualify for the minimum wage are workers of school leaving age (aged 16 the last Friday in June of the school year). Those workers can be part-time, casual workers, agency workers, trainees and workers on probation, disabled workers, agricultural workers, foreign workers, seafarers and offshore workers. It is important to note that contracts for payments below the minimum wage are not legally binding. The worker is still entitled to the minimum wage.

Holiday days also need to be taken into consideration when employing a worker/apprentice. Apprentices are entitled to a minimum of 20 days of holiday per annum, excluding bank holidays which is the same as standard employees working a 5 day week.

If you require any further information on the national minimum wage increases, employee classification, or holiday entitlements please contact the team at Spirare.