National Minimum Wage Rates April 2025
| Worker category | Rate from April 2025 | Increase from April 2024 |
|---|
| Aged 21 and over (National Living Wage) | £12.21/hour | +6.7% (from £11.44) |
| Aged 18–20 | £10.00/hour | +16.3% (from £8.60) |
| Aged 16–17 (school leaving age to 17) | £7.55/hour | +18.0% (from £6.40) |
| Apprentice rate | £7.55/hour | +18.0% (from £6.40) |
Who Gets the Apprentice Rate?
The apprentice rate (£7.55) applies to apprentices who are either: (a) under 19, or (b) 19+ but in their first year of apprenticeship. Apprentices aged 19+ who have completed their first year must be paid the rate for their age (e.g., £12.21 if aged 21+).
What Counts as Pay for NMW
Pay that counts towards NMW: basic salary, performance bonuses, commission, certain allowances, tips paid through payroll (since April 2021 amendments — but see below). Pay that does NOT count: overtime premium (the extra above basic for overtime hours), tips paid directly by customers, premium payments for working unsocial hours, expenses reimbursement.
NMW and Salary Sacrifice
Be careful with salary sacrifice: total pay after sacrifice must still meet NMW. If an employee on £12.50/hour sacrifices £1.00/hour of salary, their pay falls to £11.50 — below the NLW for 21+ workers. Salary sacrifice should be structured to maintain NMW compliance.
HMRC Enforcement
HMRC can investigate NMW underpayment and may require arrears to be paid at the current rate (not the rate when underpayment occurred). Civil penalty: up to 200% of arrears (minimum £100, maximum £20,000 per worker). Public naming and shaming for larger underpayments.
Frequently Asked Questions
What is the National Living Wage in 2025/26?
£12.21/hour for workers aged 21 and over, from April 2025. This is the National Living Wage (NLW). The National Minimum Wage for 18-20 year olds is £10.00/hour. For 16-17 year olds and apprentices (under 19 or in first year): £7.55/hour.
What is the difference between NLW and NMW?
The National Living Wage (NLW) is the minimum wage rate for workers aged 21 and over. It was called NLW to distinguish from the voluntary 'Living Wage' set by the Living Wage Foundation (currently £12.60/hour or £13.85 in London). The National Minimum Wage (NMW) refers to the lower rates for younger workers and apprentices.
Do tips count towards minimum wage?
No. Tips, gratuities and service charges paid voluntarily by customers do not count towards the NMW/NLW, regardless of how they're distributed. This was confirmed by the Employment (Allocation of Tips) Act 2023. Mandatory service charges that go to workers can count towards NMW in some circumstances.
Does salary sacrifice reduce pay below NMW?
Salary sacrifice for pension, childcare vouchers or other benefits reduces gross pay for NMW purposes. The effective hourly rate after sacrifice must still meet NMW. Example: £12.50/hour worker sacrificing £1/hour = £11.50/hour — below NLW (£12.21). Employer must restructure the scheme.
What happens if I underpay a worker?
HMRC can require arrears at the current NMW rate (not the original rate). Penalty up to 200% of arrears (minimum £100, maximum £20,000 per worker). Workers can complain to ACAS or HMRC. Employers who underpay may be publicly named by BEIS. Criminal prosecution possible in serious cases.
Are zero-hours contract workers entitled to NMW?
Yes. Zero-hours contract workers, casual workers, and workers on flexible arrangements are all entitled to NMW/NLW for every hour worked. Sleep-in shifts are complex — the Supreme Court ruled in Mencap (2021) that sleep-in workers are only entitled to NMW for hours they're actually awake and working.
Does the apprentice rate apply to all apprentices?
Only to apprentices under 19 OR in their first year of apprenticeship. After their first year AND aged 19+, apprentices must be paid the NMW rate for their age. Example: a 22-year-old apprentice in their second year must receive £12.21/hour — not the £7.55 apprentice rate.
Are interns entitled to minimum wage?
Generally yes, if they are 'workers' (as opposed to genuine volunteers or work experience students on short placements). Unpaid internships are often illegal. HMRC investigates employers who use internships to avoid paying minimum wage. Paid internships must be at least NMW/NLW.