Nov 10, 2024

How Much Is The National Minimum Wage In The UK?

The minimum wage in the UK is the lowest hourly rate employers are legally required to pay their employees. However, the rate varies depending on the employee's age, with different rates for those under 18, 18-20, 21-22, and over 23.

What is the National Minimum Wage Rate?

The National Living Wage (NLW) is a higher minimum wage rate for workers aged 23 and over. It was introduced in April 2016 to ensure that workers received a wage that would provide a decent standard of living. The NLW is currently £9.50 per hour. It will be £10.42 for the tax year ending in March 2024.

Are There Age Exceptions to The Minimum Wage?

Yes, there are age exceptions for certain workers. For example, employers must pay apprentices aged under 19 or those aged 19 or above an apprentice-level minimum wage rate in the first year of their apprenticeship. There are also different rates for accommodation as part of a job package and additional pay requirements depending on employees' working hours, industry and job title.

What Are The Different National Minimum Wage rates?

The current rates (April 2022 to March 2023) are as follows:

Accommodation offset: £8.70
Apprentice rate: £4.81
Under 18: £4.81 per hour
18-20: £6.83 per hour
21-22: £9.18 per hour
Over 23: £9.50 per hour

The rates for the year 2022-23 (April 2023 to March 2024) are as follows:

Accommodation offset: £9.10
Apprentice rate: £5.28
Under 18: £5.28 per hour
18-20: £7.49 per hour
21-22: £10.18 per hour
Over 23: £10.42 per hour

Automate payroll for all your permanent, part-time and casual workers

Payroll shouldn’t give you headaches. So we designed it to be easy. With just a few clicks, your team gets paid. You can even run it on autopilot.

Is There an Exemption for Interns?

Yes, HMRC lists exemptions for the following scenarios:

Students working as a required part of their UK-based further or higher education course provided the placement does not exceed one year. This exemption does not prevent employers from remunerating these individuals or contributing towards expenses.
pupils of compulsory school age, generally 16 years or less
participants in government schemes and programmes to provide training, work experience or temporary work or to help in seeking or obtaining work
work done as a participant in an EU Lifelong Learning Programme (Erasmus+)
voluntary workers volunteering for a charity, voluntary organisation, associated fund-raising body or statutory body and receiving no monetary payments except limited and specified expenses and benefits

What Happens if An Employer Does Not Pay The National Minimum Wage?

The minimum wage is enforced by HM Revenue & Customs (HMRC), which investigates complaints and takes legal action against employers who fail to pay the minimum wage. Sometimes, employers may be required to pay unpaid wages and face fines and other penalties.

If an employer fails to pay the National Minimum Wage, they can be fined up to 200% of the unpaid wages by Her Majesty's Revenue Customs (HMRC). The fine could be reduced to 100%, depending on how promptly the employer pays the backdated wages. Additionally, if employers don't comply and HMRC investigates their practices, the investigation could lead to a criminal offence under the National Minimum Wage Act 1998. Employers are advised to check and keep up-to-date on prevailing minimum wage regulations to avoid penalties.

Does The National Minimum Wage Apply To All Workers?

The minimum wage applies to most workers in the UK, including part-time and temporary workers, agency workers, and those on zero-hour contracts. However, it does not apply to self-employed workers, volunteers, or those on specific government training schemes.

Employers may pay more than the minimum wage if they choose to, and many do to attract and retain skilled workers. However, they are required by law to pay at least the minimum wage.

Who Is Responsible For Implementing The Minimum Wage?

The Low Pay Commission reviews the minimum wage annually, which makes recommendations to the government on the appropriate rates. The aim is to strike a balance between ensuring that workers are paid a fair wage and not placing an undue burden on employers.

In summary, the minimum wage in the UK is a legally required hourly rate that employers must pay their workers, with different rates for different age groups. It is enforced by HMRC and applies to most workers, except some self-employed workers, volunteers, and those on certain training schemes.

The minimum wage is reviewed annually, and employers are required to pay at least the minimum wage.