Almost all workers in the UK are entitled to be paid at least the National Minimum Wage - or the National Living Wage if you’re 25 or over. This page tells you how to make sure you’re being paid the right rate. It also covers common mistakes employers make when calculating the National Minimum Wage - and the difference between the National Living Wage (which is compulsory) and the Living Wage (which employers can choose to pay).
What is the National Minimum Wage?
The National Minimum Wage (NMW) is the minimum pay per hour most workers in the UK are entitled to by law.
The rate varies depending on your age and whether you’re an apprentice.
Most workers who are 25 or older must be paid at least the National Living Wage (NLW), which is the highest rate of the National Minimum Wage.
National Minimum Wage and National Living Wage Rates for 2017/18
||Minimum hourly rate
|25 and over
|21 to 24
|18 to 20
From April 2018, the National Living Wage will be increasing to £7.83. The National Minimum wages will also be rising in April 2018.
Apprentices and the National Minimum Wage
Apprentices are entitled to the apprentice rate of the National Minimum Wage if they are either:
- Under 19
- 19 or over and in the first year of their apprenticeship
Apprentices over 19 who have completed the first year of their apprenticeship are entitled to the National Minimum Wage for their age.
Am I entitled to the National Minimum Wage?
You must be at least school leaving age (the last Friday in June of the school year in which you turn 16) to get the National Minimum Wage.
Almost all workers are entitled to the National Minimum Wage, including:
- Casual workers
- Part-time workers
- Temporary workers
But if you’re self employed or a company director, you’re not entitled to the National Minimum Wage.
There are also some other types of workers who don’t qualify.
See the full list of who is entitled to the National Minimum Wage on GOV.UK.
How the National Minimum Wage and National Living Wage are calculated
Deductions from your pay before National Minimum Wage is calculated
If you’ve paid for certain things related to your job out of your wages, your employer should deduct these payments before they calculate whether you have been paid the correct minimum wage.
These payments are:
- Payments for the employer’s own use or benefit - for example, if you have paid for travel between work sites
- Payments for things you need for the job but aren’t refunded for – such as tools, uniform or equipment
All other payments made out of your wages, such as tax and National Insurance, should be included when your employer calculates whether you‘ve been paid the National Minimum Wage.
Minimum wage for different types of work – and what counts as working time
The National Minimum Wage is worked out as an hourly rate, but it applies even if you are not paid by the hour.
You can find out more about this and what counts as working time at the link below.
Find out more about the minimum wage for different types of work on GOV.UK
Accommodation and the National Minimum Wage
If your employer provides accommodation, they can take the value of this into account when calculating the National Minimum Wage or National Living Wage.
No other company benefit (such as childcare vouchers, meals, or a car) counts towards the National Minimum Wage or National Living Wage.
Find out more about accommodation and the National Minimum Wage on GOV.UK
What doesn’t count towards the National Minimum Wage
When calculating your basic pay, your employer can’t count any of these things to top up your pay to the level of the National Minimum Wage:
- Tips or gratuities
- Service charges
- Overtime or shift payments
- Cover charges from customers
However, your employer can include incentive payments or bonuses as part of your basic pay.
What to do if you think you’ve been paid less than the correct minimum wage
If you think you’ve been paid less than the correct minimum wage for your age, talk to your employer directly.
If this doesn’t solve the problem, you can ask to see your payment records and make copies of them.
You can contact the ACAS helpline for free, confidential advice to help you solve your payment dispute.
Find out more about contacting the helpline on the ACAS website.
You can also make a complaint to HMRC about your employer.
If HMRC find that you’ve been paid incorrectly, your employer must pay you any amounts they owe you and pay a fine to HMRC for paying below the minimum wage.
What is the Living Wage?
The Living Wage is set by the Living Wage Foundation. There is a UK rate and a London rate.
The UK Living Wage is £8.75 an hour and the London Living Wage is £10.20 an hour.
The Living Wage is based on the cost of living. The Resolution Foundation (a think tank that aims to improve the living standards of low and middle-income families) calculates the rates, and is overseen by the Living Wage Foundation.
Employers don’t have to pay the Living Wage, but over 3,600 employers choose to do so.
What’s the difference between the National Living Wage and the Living Wage?
The National Living Wage:
- is the highest rate of the National Minimum wage (currently £7.50 an hour)
- is set by government
- must be paid to all workers over 25
The Living Wage:
- is set by the Living Wage Foundation
- applies to all worker over 18
- is voluntary – employers can choose whether to pay it
- has two rates – a UK rate (£8.75 an hour), and a London rate (£10.20 an hour)
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