The National Living Wage has increased – make sure you’re getting paid enough as a paid carer

The new rate for the National Living Wage (NLW) has been increased as of 1st April 2024. The new rates equate to a 6.2% pay rise for workers over the age of 25, jumping from £10.42 per hour to £11.44 per hour. For a full-time, over-25 worker, this is an annual pay rise of £1,800. Many paid carers receive the National Living Wage, particularly those who work for a care provider or agency, or in a residential setting. Therefore, this increase could see a beneficial increase in your weekly or monthly take-home pay. If you are employed by an individual, you are still entitled to at least the National Living Wage. If you are a care provider or small business, then it’s essential that you increase your employees’ wages to ensure they continue to receive the National Living Wage, if that is their current rate. If you use a Payroll Service (such as the one offered by You’re the Boss), these changes will be implemented where relevant and reflected on future payslips. The rise means the Government is on track to meet its target of setting the National Living Wage at 60% of median earnings this year. It’s thought that nearly 3 million workers will benefit from the increase. According to the Chancellor of the Exchequer, Sajid Javid, the NLW should increase to £10.50 by 2024, based on current forecasts. The increased rates are recommended by the Low Pay Commission, an independent, advisory body. The National Minimum Wage (NMW) has also increased across all age groups from school leaving age and including apprentices.

What is the difference between the National Minimum Wage and the National Living Wage?

This year marks 25 years since the introduction of the National Minimum Wage, essentially, there is no difference between the NMW and the NLW. The National Minimum Wage is set annually by the Government, and updated every April. The NMW applies to any worker over school leaving age. The NMW does not apply to self-employed people running their own business. If you operate as (or are thinking about operating as) a self-employed paid carer, it is up to you to ensure that you set your prices to cover your costs and expenses, and pay yourself a fair wage.  The NMW also does not apply to company directors, volunteers or family members of the employer living in the employer’s home. The National Living Wage was introduced in the Summer Budget 2015, and came into law on 1st April 2016. It is in essence just a new name for the National Minimum Wage, though it only applies to those over the age of 21, but it does not reflect the true cost of living. It is based on a proportion of the median level of earnings. How much you should be getting paid as a carer is dependent on your age, and there is a different rate if you’re working as a first-year apprentice. The current rates are as follows (correct as of 1st April 2024). 

21 and over	18 to 20	16-17	Apprentice
£11.44	£8.60	£6.40	£6.40

For more information on the rates, and to view previous rates, visit the government website. As we’ve said, the National Living Wage doesn’t reflect the true cost of living. The Living Wage Foundation sets out the recommended Real Living Wage, which accounts for the amount people need to get by. Many employers will opt to offer their employees the Real Living Wage, but they are only legally required to offer the National Living Wage. Employers could face a fine if they pay less than the NMW/NLW.