The Low Pay Commission (LPC) is the independent body that advises the Government on the level of the minimum wage. We have been asked to recommend in October this year the National Minimum Wage (NMW) and National Living Wage (NLW) rates to apply from April 2021. All interested parties are invited to submit evidence to our consultation by Thursday 4 June 2020.
From 1 April 2020, the NLW will increase to £8.72, reaching the target of 60 per cent of median earnings set by the Government in 2015. The Government have now asked the LPC to increase the NLW towards a new target of two-thirds of median earnings by 2024. Alongside this, the age threshold for the NLW will be reduced from its current level of 25, to 23 in 2021 and then to 21 by 2024.
For the remaining NMW rates (the 21-22-Year-Old Rate, the 18-20-Year-Old Rate, the 16-17-Year-Old Rate and the Apprentice Rate, we are consulting on our usual approach of raising the rate as high as possible without damaging employment.
What we would like evidence on
Our consultation letter contains a full list of the topics and questions we are seeking evidence on. Our main concern is to gather evidence on the effects on employers and workers of the recent increases in the NMW and NLW. As each year, we are seeking views on business conditions and the economic outlook, especially given factors such as the ongoing coronavirus outbreak.
This year we are particularly interested in:
The affordability and effects of an increase in April 2021 to an NLW rate of £9.21. This is our current central projection for next April’s rate, with a likely range of 6 pence above or below this figure.
Views on the LPC’s remit to 2024, involving a new NLW target of two-thirds of median earnings and lowering the NLW age threshold to 21. Based on forecasts, our current central projection for the April 2024 NLW rate is £10.69, with a likely range of 30 pence above or below this figure.
Views on potential changes to the Apprentice Rate and their effects in particular on younger (16-18 year old) apprentices. Our consultation letter sets out the context for these proposals, and a separate information note is available below.
We also want to hear about the effects of recent increases in the NLW and other rates, and their impacts in particular on employment and hours, pay and benefits, productivity, prices and profits.
Who we would like evidence from
Download the consultation letter for details on the evidence we are seeking and a list of questions to consider,
You can respond to the consultation by e-mail or by post using the details below. The consultation closes on Thursday 4 June.
In addition to this written consultation, the Low Pay Commission also conducts a series of visits around the UK, and holds bilateral meetings to gather evidence from individual organisations. Find out more about the visits on our website and blog. If you want to arrange a meeting, email using the details below.
How to respond
Responses are requested by email.
Because of the ongoing coronavirus outbreak and a move to home working we cannot guarantee to read postal responses. Please contact us if this causes you a problem.
2-6 Salisbury Square
Telephone 020 7211 8119
Our programme of regional visits for 2020 has been suspended, again due to the coronavirus outbreak. Despite this, we will continue to work to fulfil our remit and gather information on the economy and labour market.
Ways to respond
Low Pay Commission
8th Floor, Fleetbank House
2-6 Salisbury Square