What is the National Minimum Wage?

Every employer in the UK is required to pay employees at least the National Minimum Wage — or the higher National Living Wage for workers above a certain age — but many founders, particularly those hiring for the first time, are uncertain about which rate applies to which workers and what happens if a business pays below the required rate.

The National Minimum Wage is the minimum hourly rate UK employers must pay their workers, with different rates applying depending on the worker's age and whether they are an apprentice. The National Living Wage is the higher rate that applies to workers above a defined age. Both rates are set by the government and increase annually. Current rates are published by the government and should always be verified at the point of hiring.

Paying below the National Minimum Wage — even accidentally — is a legal breach that can result in HMRC enforcement, financial penalties, and public naming. The calculation is per hour, and total pay must be divided by total hours to confirm compliance, which can catch out employers of workers with variable hours. Our guide to National Minimum Wage for UK employers covers the calculation method and how to verify compliance.