The government sets a national minimum wage and a national living wage to guarantee the lowest paid workers get a minimum standard of pay. This is a legal requirement for all businesses of any size, so read on to make sure you’re complying with the latest rates and check the rules for different age groups and apprentices.
If you’re self-employed and running your own business or if you’re a company director, you aren’t entitled to national minimum wage or national living wage.
The National Minimum Wage Act 1998 was introduced to make sure that the lowest paid workers are paid fairly while protecting employment.
Be aware that employment contracts with a lower rate of pay aren’t legally binding – and not complying with the law on minimum wage can lead to an investigation from HMRC.
In April 2016, the government introduced a new minimum rate of pay for workers who are at least 25 years old – this is called the national living wage. And since April 2021 more younger people have been eligible for the wage as the threshold now includes anyone aged 23 and over.
While the rate isn't necessarily based on the cost of living, the government set a target to increase the living wage to two-thirds of median earnings of all employees across the country by 2024. This was achieved in 2021 following recommendations from the Low Pay...
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