“A proper day’s work deserves a proper day’s pay.” — Angela Rayner, Deputy Prime Minister.
We couldn’t put it better ourselves. When your employees put in an honest day’s effort, give their time, energy, and skill to a task or role, they deserve to be compensated fairly.
Something which the Labour government are already showing their commitment to, with their first Autumn Budget announcing a boost to the minimum wage. Let’s see what the 2025/26 National Minimum Wage and National Living Wage are set to be. And how they’ve changed from 2024/25.
National Minimum Wage for 2025/26
Here are the latest National Minimum Wage rates, which will come into force from 1 April 2025:
| NMW Rate | Increase (£) | Percentage increase |
National Living Wage (21 and over) | £12.21 | £0.77 | 6.7 |
18–20-year-old rate | £10.00 | £1.40 | 16.3 |
16–17-year-old rate | £7.55 | £1.15 | 18.0 |
Apprentice Rate | £7.55 | £1.15 | 18.0 |
Accommodation offset | £10.66 | £0.67 | 6.7 |
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How many UK employees will this affect?
Over 3 million UK employees are set to receive a pay boost in 2025 thanks to the government’s decision to increase the National Living Wage by 6.7%. This means a full-time employee could see an annual pay rise of around £1,400.
“This Government promised a genuine living wage for working people. This pay boost for millions of workers is a significant step towards delivering on that promise.” — Rachel Reeves, Chancellor of the Exchequer
What some employers don’t know or understand about NMW in 2025/26
- One of the key failures when calculating NMW is employers not clearly communicating working hours, breaks and other working time in their wage calculations.
- Working hours includes any time at work or on standby—even if an employee is unable to work due to a failure in machinery, or other delays.
- Working hours also includes travelling time (excluding normal home to work commute).
- Deductions from wages can cause the hourly rate to drop below NMW or NLW rates.
- There’s a defined list of allowable deductions that can reduce the wage below NMW, but this must be strictly adhered to.
- Just because an employee has agreed to a deduction, doesn’t make it legal.
Are you looking for timely and accurate payroll that keeps you on top of minimum wage rates?
Calculating payroll can be complicated, especially if you have a mix of full-time employees, part-time employees and apprentices.
With Cintra, you’re in safe hands. Everyone (and we mean everyone) will get paid the right amount, on time, every time.
Book a personalised demo today to see either Cintra’s payroll software or outsourced services in action.
Payroll Legislation Guide
The facts, figures, thresholds and allowances for 2024/25 spanning tax, National Insurance, pensions, statutory payments and more.
