National Minimum Wage – watch for the bear-traps


In the latest Government figures around National Minimum Wage non-compliance, 47% of businesses who had not paid the correct amount, had wrongly deducted pay from workers’ wages, for expenses such as uniforms; 30% had failed to pay workers for all the time they had worked, such as for overtime; and 19% had paid the incorrect apprenticeship rate.  In most cases these non-compliance cases were not intentional, but were simple errors.  To prevent clients from making any errors, here we set out some bear-traps around the National Minimum Wage (NMW):

The Rules are Applied Rigidly

The Department of Business, Energy & Industrial Strategy (BEIS) looks after NMW legislation, while HMRC looks after its enforcement. Because it’s not covered by the Taxes Management Act, however, there is no authority for a flexible, behaviour-based approach to enforcement and penalties. As a result, the rules are applied much more rigidly.

NMW applies to all worker types

The NMW is not about low-paid workers – it applies to pretty much everyone in the organisation.  For example, if an employee asks to sacrifice their salary so they can put everything into their pension, they would still have to be paid at least the National Minimum Wage for the hours that are worked.

The exceptions to the NMW are:

  • self-employed (by choice)
  • a volunteer (by choice)
  • a company director
  • in the armed forces
  • doing work experience as part of a course
  • work shadowing
  • under school leaving age

2022 Rates

YEAR 23 AND OVER 21 TO 22 18 TO 20 16 TO 17 APPRENTICE
2021/2 £8.91 £8.36 £6.56 £4.62 £4.30
2022/3 £9.50 £9.18 £6.83 £4.81 £4.81


Castletons Accountants

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