Keeping track of pay rates can feel like a bit of a moving target but we have some solid dates and numbers to look at now. If you are running a business or managing a team it is important to know exactly when your costs are going to shift so you can plan ahead without any surprises.
At ConnectSimpli, we help businesses stay on top of these changes through our HR and payroll software so we thought we would break down everything you need to know about the upcoming increases in simple terms.
When does the National Living Wage go up?
The big date to remember is April 1, 2026. This is when the government’s mandatory National Minimum Wage rates change across the UK.gov
If you have employees who are 21 or older they are legally entitled to the National Living Wage. Right now that rate is sitting at £12.21 per hour but from April 1 it is jumping up to £12.71. That is a 4.1% increase which might not sound huge on paper but it definitely adds up when you are looking at your monthly payroll.gov
Our payroll software can automatically update these new rates and recalculate your monthly payroll so you stay compliant without extra manual work.
What about younger workers and apprentices?
The government is also trying to close the gap between what younger people and older people earn. Because of that the rates for 18 to 20‑year‑olds are seeing a much bigger jump.
From April 2026 those workers will go from £10.00 to £10.85 per hour. That is an 8.5% rise which is quite a significant change for businesses that employ a lot of young staff. Apprentices and 16 to 17‑year‑olds are also seeing an increase to £8.00 per hour.gov
Businesses using ConnectSimpli’s HR and payroll platform can quickly see which employees fall into these age‑based brackets and adjust their pay in line with the new rules.
The Real Living Wage vs. The National Living Wage
It is easy to get these two mixed up because the names are so similar. The National Living Wage we just mentioned is the legal minimum you have to pay. However there is also something called the Real Living Wage which is set by the Living Wage Foundation.wikipedia+1
This is a voluntary rate that some employers choose to pay because it is based on the actual cost of living like the price of groceries and bills. For those of you who are accredited Real Living Wage employers those rates actually went up recently to £13.45 (or £14.80 in London). If you are part of this group you have until May 1, 2026 to make sure those new rates are reflected in your employees’ pay.linkedin
ConnectSimpli can help accredited Real Living Wage employers manage these voluntary rate changes through flexible payroll rules and automated updates.
How to get ready
We know that a rise in wages can be a bit stressful for business owners. It means your National Insurance contributions go up and your pension auto‑enrolment costs might tick up too. The best thing you can do now is take a look at your current staff list and see who falls into these new brackets.gov
Using a system like our payroll software makes this a lot easier because it handles the calculations for you. You won’t have to manually figure out the new totals or worry about missing the April deadline. It is all about making sure your team is paid fairly and your business stays compliant without the headache.gov
So now is the perfect time to review your budgets for the year ahead. If you have any questions about how these rates affect your payroll, we are always here to help you navigate it.
