National Living Wage Increases and Future Targets
Posted on in Business News , Cycles News , Political News
T
he National Living Wage and National Minimum Wage rates increased yesterday, following recommendations made to the Government by the Low Pay Commission (LPC).
This short report accompanies the 2020 increases in the National Living Wage (NLW) and National Minimum Wage (NMW). This year's increase in the NLW, to £8.72, brings the rate to the target of 60 per cent of median earnings, originally set in 2015. The report looks at the effect of the National Living Wage over time on pay and employment over that time period.
The Government has set a new target for the NLW to reach two-thirds of median earnings by 2024. The report sets out how the LPC will approach its new remit and the higher target. At this stage a projected pathway to the 2024 target has now been set out, given uncertainty about the impact of the ongoing Covid-19 outbreak.
The Low Pay Commission have stated they will consider the impact of the COVID-19 outbreak on the future of the National Living Wage targets, which is set to reach two thirds of median earnings by 2024, by considering two options:
1) Reducing wage rates in a given year, but commit to reach existing targets by 2024
2) Delay the timeframes for meeting the NLW target.
The full The National Minimum Wage in 2020 document is available here.