National Minimum Wage and National Insurance Increases 2025: What Employers Need to Know
Starting April 2025, businesses across the UK must prepare for significant changes in employment costs. The National Minimum Wage (NMW) is increasing once again, alongside a rise in National Insurance Contributions (NICs). These adjustments bring financial challenges, especially for companies relying on temporary workers and flexible staffing solutions.
At Extra Workforce, we understand the impact these changes will have on your business. Our goal is to help you navigate these rising costs efficiently, ensuring compliance while maximising the value of your workforce strategy.
Key Changes for 2025
1. National Minimum Wage Increases
The table below highlights the NMW changes from 2024 to 2025, helping you assess the financial impact on your business:
| Category | 2024 Rate (£/hour) | 2025 Rate (£/hour) | Increase (%) |
|---|---|---|---|
| National Living Wage (21+) | 11.44 | 12.21 | 6.73% |
| Ages 18-20 | 8.60 | 10.00 | 16.28% |
| Under 18 | 6.40 | 7.55 | 17.97% |
| Apprentices | 6.40 | 7.55 | 17.97% |
These adjustments align with the government’s commitment to improving wages, particularly benefiting younger workers and apprentices entering the job market.
2. National Insurance Contribution (NIC) Changes
Starting April 6, 2025, the following NICs adjustments will take effect:
| Contribution Type | 2024 Rate (%) | 2025 Rate (%) | Threshold Change | Business Impact |
| Employer NICs | 13.8% | 15.0% | Secondary Threshold reduced from £9,100 to £5,000 | Increased employer NICs for workers earning over £5,000/year |
| Employee NICs | 12.0% | 12.0% | No Change | No increase for employees; contributions remain stable |
| Additional Rate NICs | 2.0% | 2.0% | No Change | No impact on high earners |
| Employment Allowance | £5,000 | £10,500 | Increased | Greater support for small businesses to offset NIC increases |
While employers will face higher NIC costs, the Employment Allowance increase will provide much-needed relief to smaller businesses, helping mitigate these additional expenses.
How Extra Workforce Can Help
Adapting to these rising employment costs doesn’t have to be overwhelming. Extra Workforce, powered by our innovative online platform, offers tailored solutions to help you manage these changes effectively.
1. Compliance Made Simple
Our Compliance Monitor ensures your workforce meets all legal requirements, storing verified documents such as Right to Work checks and National Insurance compliance records. With 24/7 accessibility, our system saves time and protects your business from costly fines and penalties.
2. Smarter Workforce Planning
Our Shift Planner optimises workforce allocation, minimising unnecessary labour costs. With real-time insights into shift distribution and employee roles, you can make data-driven hiring and scheduling decisions, reducing overhead expenses.
3. Streamlined Payroll Management
With NICs increasing, accurate payroll management is more important than ever. Our Online Timesheets simplify tracking, approvals, and amendments. Extra Workforce’s payroll solutions ensure full transparency and compliance, reducing administrative burdens while safeguarding your business from payroll risks.
4. Faster and More Efficient Onboarding
Our Digital Onboarding system accelerates candidate readiness. By allowing new hires to complete training and documentation online before their first day, they can start work sooner, improving retention rates and reducing onboarding costs.
Why Choose Extra Workforce?
With rising employment costs, maximising the value of your temporary workforce is crucial. At Extra Workforce, we combine expertise, technology, and tailored solutions to support your business.
Our Key Benefits:
- Access to a continuously refreshed talent pool, ensuring high-quality candidates.
- Comprehensive workforce support, including monthly incentives, site visits, and wellness check-ins.
- Expert guidance on compliance and workforce strategy to reduce employment costs.
- A dedicated team focused on enhancing your recruitment and staffing efficiency.
Take Action Today
Don’t let rising employment costs disrupt your business operations. With Extra Workforce Recruitment, you can turn challenges into opportunities.
📞 Contact us today to discover how we can help you manage costs, stay compliant, and maintain a competitive edge.