A Jamie HR manager's guide

The manager's guide to National Minimum Wage rates

A practical guide for managers and small businesses on the National Minimum Wage and National Living Wage rates from April 2026: who they apply to, how pay reference periods work, common causes of underpayment, and how HMRC and the Fair Work Agency enforce the rules.
April 2026 rates
Who counts as a worker
Avoiding common errors

Minimum wage rates change every April, and getting them wrong is expensive.

This guide sets out the National Minimum Wage and National Living Wage rates in force from 1 April 2026, who is entitled to them, and the common causes of underpayment identified in gov.uk guidance and enforcement data. It also covers how the Fair Work Agency and HMRC enforce the rules, and the penalties that apply when pay falls short.

What's inside
The rates from 1 April 20263
The Apprentice Rate: who it applies to4
Who counts as a worker5
The accommodation offset6
Pay reference periods and the average hourly rate7
Where underpayment happens by accident8
How the rules are enforced9
Penalties and the naming scheme10
Getting NMW and NLW right11
How Jamie HR helps12

The rates from 1 April 2026

The government confirmed new National Minimum Wage and National Living Wage rates from 1 April 2026, following recommendations from the independent Low Pay Commission.
  • National Living Wage (age 21 and over): £12.71 an hour, a 4.1% increase.
  • 18-20 Year Old Rate: £10.85 an hour, an 8.5% increase, the largest rise of the four rates.
  • 16-17 Year Old Rate: £8.00 an hour, a 6.0% increase.
  • Apprentice Rate: £8.00 an hour, a 6.0% increase, now matching the 16-17 Year Old Rate.
  • These rates took effect on 1 April 2026 and apply to every pay reference period starting on or after that date.
Manager tip
Update your payroll system for the new rates before your first pay reference period starting on or after 1 April 2026, and check every worker has moved to the correct band, including anyone who has just turned 18 or 21, or finished the first year of an apprenticeship.

The Apprentice Rate: who it applies to

The Apprentice Rate is easy to apply to the wrong worker, and gov.uk's own enforcement data shows it as a recurring cause of underpayment.
  • The Apprentice Rate of £8.00 an hour applies to apprentices aged under 19.
  • It also applies to apprentices aged 19 or over who are in the first year of their apprenticeship.
  • Once an apprentice turns 19 and has completed the first year of their apprenticeship, they must move to the National Minimum Wage or National Living Wage rate for their age.
  • gov.uk's National Minimum Wage Naming Scheme educational bulletin (Round 22) recorded apprentice rate errors, mainly paying the Apprentice Rate for too long, in 21% of the cases in that round.
Watch out
Diarise the date each apprentice completes their first year, so their pay moves to the correct age-related rate on time rather than staying on the Apprentice Rate by default.

Who counts as a worker

National Minimum Wage and National Living Wage entitlement is based on 'worker' status, which gov.uk guidance confirms is broader than 'employee'.
  • gov.uk guidance confirms the minimum wage applies to workers, including part-time staff, casual labourers, agency workers, and homeworkers paid by the number of items they make.
  • Apprentices, trainees, and staff on probation are entitled to at least the Apprentice Rate or the rate for their age.
  • Company directors, people who are genuinely self-employed and running their own business, volunteers, and most family members living in the employer's home are not entitled to the minimum wage under gov.uk guidance.
  • Work experience placements of up to one year as part of a UK-based further or higher education course are excluded, along with some government training scheme participants.
  • Base entitlement on the individual's worker status and age, not on their job title or what the contract calls them.

The accommodation offset

If you provide living accommodation to a worker, gov.uk rules let you count a limited amount of its value towards their minimum wage pay.
  • The accommodation offset is £11.10 a day, or £77.70 a week, from 1 April 2026.
  • You can offset accommodation up to this amount, even if you charge the worker more for it.
  • If you charge the worker less than the offset rate, or provide the accommodation free, no reduction applies to their pay for minimum wage purposes.
  • If you charge more than the offset rate, the excess above it counts as a deduction from pay for minimum wage purposes.
Watch out
gov.uk's naming scheme data records accommodation offset miscalculation as a recurring cause of underpayment. Check any accommodation charge against the current offset rate every time the rate or the charge changes.

Pay reference periods and the average hourly rate

gov.uk guidance checks minimum wage compliance over a pay reference period, not on a single day or shift.
  • A pay reference period is the period covered by each payment, matching your worker's normal pay cycle: weekly, fortnightly, or monthly.
  • gov.uk guidance sets a maximum pay reference period of one calendar month, even for staff paid less often.
  • To check compliance, divide the worker's total pay for the period by their total working hours in that period, applying gov.uk rules on what counts as pay and as working time.
  • The resulting average hourly rate must meet or exceed the correct minimum wage rate for that worker's age and status.
Manager tip
Recalculate the average hourly rate whenever hours or pay change part-way through a pay reference period, rather than relying on the rate set at the start of it.

Where underpayment happens by accident

gov.uk's Check Your Pay guidance and National Minimum Wage Naming Scheme bulletins list a consistent set of causes behind accidental underpayment.
  • Not paying for time spent travelling between appointments or assignments during the working day.
  • Making deductions for uniform, branded clothing, or safety equipment that take pay below the minimum wage.
  • Not paying for time spent on mandatory training, wherever and whenever it takes place.
  • Not paying for trial shifts, which gov.uk guidance treats as working time in most circumstances.
  • Not paying for short periods of work before or after a scheduled shift, such as security checks or handovers.
  • Missing the date a worker turns 18 or 21, or otherwise moves into a higher rate band.

How the rules are enforced

Since 7 April 2026, the Fair Work Agency has been responsible for enforcing the National Minimum Wage.
  • The Fair Work Agency (FWA) is an executive agency sponsored by the Department for Business and Trade.
  • HM Revenue and Customs officers act as FWA enforcement officers for the purposes of enforcing the minimum wage, so HMRC continues to carry out day-to-day compliance work under the FWA's authority.
  • Workers, or anyone else, can report suspected underpayment; the person reporting does not need to be the worker affected.
  • An investigation can examine pay records going back several years, not only the current pay reference period.

Penalties and the naming scheme

Underpaying the minimum wage carries a financial penalty on top of repaying the arrears, and can lead to being publicly named.
  • Employers found to have underpaid must repay the arrears in full, calculated at current minimum wage rates rather than the lower rate that applied at the time.
  • A financial penalty of 200% of the total underpayment also applies, subject to a minimum of £100 and a maximum of £20,000 per worker.
  • The penalty is reduced by 50% if the arrears and the reduced penalty are paid in full within 14 days.
  • The Department for Business and Trade considers employers for public naming where arrears are £500 or more, or £100 or more for repeat offenders and those breaching a previous enforcement undertaking.
  • Deliberate or persistent non-compliance can be referred for criminal prosecution.
Watch out
The 200% penalty applies to genuine payroll mistakes as well as deliberate underpayment. Check your rates and calculations against the current figures regularly, rather than relying on a one-off review.

Getting NMW and NLW right

A summary of the essentials covered in this guide:
  • Apply the correct rate for each worker's age and apprentice status from 1 April 2026: £12.71, £10.85, or £8.00 an hour.
  • Check worker status carefully; entitlement is broader than 'employee' and depends on the individual's status, not their job title.
  • Offset accommodation charges correctly against the current daily and weekly offset rates.
  • Calculate the average hourly rate over the correct pay reference period whenever pay or hours change.
  • Pay for travel between assignments, mandatory training, and trial shifts, and avoid deductions that take pay below the minimum wage.
  • Remember that HMRC now acts on behalf of the Fair Work Agency, and that penalties and naming apply even to genuine mistakes.

How Jamie HR helps

Getting minimum wage right depends on applying the correct rate to the correct worker, every pay reference period. Jamie HR keeps that straightforward.
  • Automatic age tracking that flags when a worker moves into a new minimum wage band.
  • Apprentice records that track start dates and first-year anniversaries.
  • Payroll-ready reports so pay reference periods and hours worked are easy to check.
  • Document storage for contracts, accommodation agreements and pay records in one place.
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This guide is general information, accurate to the best of our knowledge as of 2026, and is not legal advice. Minimum wage rates and enforcement rules change and every situation is different, so for a specific case take professional HR or legal advice. Sources: gov.uk and the National Minimum Wage Act 1998 (as amended).