Skip to main content

Employee Pay and the National Minimum Wage

The National Minimum Wage is a minimum hourly rate of pay that most employees are entitled to. Most employers, regardless of size, are obliged to pay the National Minimum Wage, and it is your responsibility as an employer to ensure that your workers’ wages are compliant with it.

National Minimum and Living Wages

The minimum wage requirements can vary depending on the employee's age or job situation, with both National Minimum and National Living Wage provisions: 

Unless work is conducted on a voluntary basis, workers will expect to be paid for providing their services.  As an employer, you are responsible for ensuring that workers’ rate of pay is at least equivalent to the National Minimum Wage, which is a prescribed rate of pay for workers who are over the compulsory school age (16 years of age). The rate will vary dependent on the worker’s age or job situation, for example apprentices have a separate rate.  

Minimum hourly wage rates from 1 April 2021 are as follows:

Age 25+

£8.91 per hour

(National Living Wage)

Age 21-24

£8.36 per hour

Age 18-20

£6.56 per hour

Age 16-17

£4.62 per hour


(if under 19 or in first year of apprenticeship)

£4.30 per hour

These rates increase annually.

Whether a worker has received the National Minimum Wage will depend on their average hourly rate. This is calculated on the basis of:

The total remuneration earned over the relevant pay reference period (for example a month or a week) divided by the total number of hours worked over the pay reference period.

When a worker is due to be paid, you should ensure that they are provided with a written pay statement setting out their gross pay and take home pay. The statement should detail any deductions that have been made, such as National Insurance or pension contributions. 

The National Minimum Wage Regulations set out what can and cannot be included in calculating whether a worker is receiving the National Minimum Wage. Depending on how a worker is paid, the calculations can be complicated. There are also specific rates for agricultural workers.

With the Government ‘naming and shaming’ companies who fail to pay the National Minimum Wage, getting it wrong can be extremely damaging to a business’ reputation as well as costly, as they may face claims for back pay. Companies can also be prosecuted by HMRC.

How can Thorntons help?

Our specialist employment team is experienced in advising employers in respect of their obligations under National Minimum Wage legislation. We can help you to ensure that you are paying your workers in accordance with the legislation, and can advise you on how to accurately calculate a worker’s hourly rate of pay for these purposes.

In most employment situations taking legal advice early on can often stop the situation from escalating and will save you time and money later. With our proactive advice, our Employment Lawyers can help find the right solution for you over employee management issues including compliance with pay legislation. Give one of our team a call on 03330 430 350 , or complete our online enquiry form and we will contact you.