National Minimum Wage 2026: Rates and Employer Rules
For UK employers: new minimum wage rates took effect on 1 April 2026, with the National Living Wage now £12.71 an hour for workers aged 21 and over. This explainer covers every rate you need, who they apply to, and the everyday pay practices that can push a worker below the legal minimum without you noticing.
Key takeaways
- From 1 April 2026: £12.71 an hour for workers aged 21 and over, £10.85 for 18 to 20 year olds, and £8.00 for eligible apprentices.
- The under-18 rate also went up. Check GOV.UK for the current figure.
- The minimum applies to the average hourly pay over each pay reference period, after certain deductions, so uniform costs and unpaid time can cause underpayment.
- Underpaying employers must pay arrears and can be fined and publicly named by the government.
The minimum wage looks simple: pay at least the hourly rate. In practice, most underpayments by small businesses are accidental. A worker's birthday moves them into a higher band and payroll is not updated. A uniform deduction takes their pay just below the line. Unpaid time spent opening up or closing down adds hours without adding pay. Each one is a breach, even if nobody intended it.
This article sets out the 2026 rates, explains how the calculation actually works, and gives you a routine to stay on the right side of the law. It is general information, not legal advice. Rates are reviewed every year and the detailed rules are complex, so check GOV.UK or speak to Acas or a qualified adviser about your particular situation.
The rates from 1 April 2026
The National Living Wage is the legal minimum for workers aged 21 and over. The National Minimum Wage covers younger workers and apprentices. All rates are per hour and apply from 1 April 2026.
| Worker | Minimum hourly rate |
|---|---|
| Aged 21 and over (National Living Wage) | £12.71 |
| Aged 18 to 20 | £10.85 |
| Under 18 | Increased from April 2026; check GOV.UK for the current rate |
| Apprentice rate | £8.00 |
Who gets the apprentice rate
The apprentice rate applies to apprentices under 19, and to apprentices aged 19 or over who are in the first year of their apprenticeship. Once an apprentice aged 19 or over completes their first year, they must be paid at least the rate for their age. This is one of the most commonly missed changes, because nothing about the job changes on the anniversary.
Who the minimum wage covers
The minimum wage applies to workers, not just employees. That includes part-time staff, casual and agency workers, and people on zero-hours contracts. There are some exceptions, such as genuinely self-employed people running their own business and certain volunteers, but calling someone self-employed or a volunteer does not make it so. If the reality is that they work for you under your control, assume the minimum wage applies and check with Acas if unsure.
How the calculation works
Minimum wage compliance is not checked against the hourly rate on a contract. It is checked against what the worker actually received for the time they actually worked, averaged over the pay reference period. That is the period their pay covers, such as a week or a month, up to a maximum of a month.
- Work out total pay for the period. Start with gross pay, then remove the items that do not count towards the minimum wage, such as some premiums and allowances.
- Take off deductions that reduce minimum wage pay. Some deductions, such as payments for items connected to the job, can reduce the pay that counts.
- Work out the hours worked. Include all the time that counts as work, not just scheduled shifts.
- Divide pay by hours. The result must be at least the right minimum rate for the worker's age and status.
The detailed rules on what counts as pay, which deductions matter and which hours count are set out in GOV.UK guidance. Payroll software helps with the arithmetic, but it only knows the hours and pay you give it.
Example
Imagine Grace, aged 23, works in a small shop and is paid exactly £12.71 an hour for 30 scheduled hours a week. Her manager asks her to arrive 15 minutes early every day to set up the tills, unpaid. Over 5 days that is an extra hour and a quarter of work each week. Her pay stays the same but her hours rise, so her average hourly pay falls below £12.71. That is an underpayment, even though her contract rate is correct. The name and numbers are made up.
Common ways employers underpay without meaning to
These are the situations that most often catch small employers out. Check each against your own business.
- Missing a birthday. When a worker turns 18 or 21, their minimum rate rises from the start of the next pay reference period. Put staff birthdays into your payroll calendar.
- Missing an apprenticeship anniversary. An apprentice aged 19 or over moves to the age rate after the first year.
- Unpaid working time. Opening and closing duties, mandatory training, handovers, team meetings and time spent waiting to be searched or for a till check can all count as working time.
- Uniform and equipment costs. Requiring staff to buy a uniform or tools, or deducting the cost, can take pay below the minimum.
- Salaried staff on long hours. A salary that looks generous can fall below the minimum once overtime hours are counted, especially for managers in small hospitality businesses.
- Pay rises paid late. If payroll is not updated for 1 April, staff on or near the minimum are underpaid from that date.
- Tips and service charges. These do not count towards the minimum wage. The minimum must be met from wages alone.
Common mistake
Paying exactly the minimum wage as the contract rate and assuming the job is done. With no headroom, any unpaid extra minutes, a uniform deduction or a missed rate change puts you in breach. Many employers set their lowest rate a little above the legal minimum as a buffer.
What happens if you underpay
HMRC enforces the minimum wage on behalf of the government. It can investigate following a complaint from a worker or as part of its own checks. If you have underpaid, you must pay the arrears to the worker. Employers who underpay can also be fined, and the government can publicly name employers who have broken minimum wage law.
Workers can also bring claims themselves, for example through an employment tribunal. Beyond the money, being named can damage your reputation with customers and future staff, which matters for a small local business.
If you discover that you have underpaid someone, do not wait. Work out what is owed, pay it, fix the cause and keep a record of what you did. Acas can give confidential guidance on how to put things right.
Pro tip
Run a quick minimum wage audit every March, before the April rate change. For each worker, check their age band, apprentice status, any deductions and any unpaid time. Then update payroll so the new rates apply from the first pay reference period starting on or after 1 April.
Budgeting for the 2026 rates
The minimum wage is only part of the cost of employing someone on the lowest rate. Your total cost also includes employer National Insurance on earnings above the secondary threshold, workplace pension contributions for those you must enrol, and holiday pay. When the minimum rises, these related costs usually rise too.
For example, if you employ several people near the minimum, the April increase affects every hour they work, plus the knock-on costs above. Some businesses also adjust pay for staff just above the minimum to keep a gap between roles. Plan the increase into your budget and pricing early rather than discovering it on the first April payroll.
The Employment Allowance can reduce your employer National Insurance bill by up to £10,500 a year if you are eligible, which can help offset some of the increase. Check the eligibility rules on GOV.UK.
Records you need to keep
You must be able to show that you paid at least the minimum wage. Keep clear records of hours worked, pay, deductions and the rates applied for each worker. HMRC can ask to see them, and a worker can ask to see their own records. Accurate time records are your best protection if a worker later says they worked unpaid hours.
Minimum wage checklist
- Update payroll to the 1 April 2026 rates for every age band
- Check the current under-18 rate on GOV.UK
- Record every worker's date of birth and apprenticeship start date
- Pay for all working time, including set-up, close-down and training
- Review uniform, equipment and other deductions
- Check salaried staff's pay against their actual hours
- Keep tips and service charges separate from wages
- Keep accurate time and pay records
- Diary a March audit before next year's change
Frequently asked questions
When does a worker move to a higher age rate?
From the start of the next pay reference period after their birthday. Build birthdays into your payroll so the change happens automatically.
Do I have to pay the minimum wage to someone on a trial shift?
If the trial shift involves doing real work for your business, it generally counts as work and should be paid. Short, genuine assessments may be different. Check the GOV.UK guidance or ask Acas if unsure.
Can I count tips towards the minimum wage?
No. Tips, gratuities and service charges do not count towards minimum wage pay. Workers must receive at least the minimum from their wages.
Does the minimum wage apply to family members?
There are specific exceptions for some family members who live in the employer's home and share in household tasks and activities. Outside those cases, family members who are workers are entitled to the minimum wage. Check GOV.UK for the exact conditions.
Related reading
The bottom line
From 1 April 2026 the National Living Wage is £12.71 an hour for workers aged 21 and over, £10.85 for 18 to 20 year olds and £8.00 for eligible apprentices, with a higher under-18 rate to check on GOV.UK. Compliance is about what workers actually receive for the hours they actually work, not just the rate in the contract.
Track birthdays and apprenticeship anniversaries, pay for all working time, watch deductions and keep good records. A short audit before each April increase is the simplest way to avoid arrears, fines and being publicly named.
