Minimum Wage Rates from April 2027: What Employers Need to Do Now
On 28 October 2026 the government confirmed the minimum wage rates that will apply from April 2027. The National Living Wage for workers aged 21 and over will rise to £13.21 an hour. Every other rate is going up too. April may feel a long way off, but now is a good time to check your pay rates, update your budgets and plan any pay conversations with your team.
The new rates
The government accepted the Low Pay Commission's recommendations in full. Each rate rises by 3.9%.
| Rate | Now (from April 2026) | From April 2027 |
|---|---|---|
| National Living Wage (21 and over) | £12.71 | £13.21 |
| 18 to 20 | £10.85 | £11.27 |
| Under 18 | £8.00 | £8.31 |
| Apprentice | £8.00 | £8.31 |
| Accommodation offset (per day) | £11.10 | £11.53 |
The rates have been announced but not yet put into law. That normally happens through regulations made before April, so keep an eye out for the confirmed start date.
The government still aims to lower the National Living Wage age threshold from 21 to 18 over time. For April 2027, though, the Low Pay Commission recommended pausing on bringing the 18 to 20 rate closer to the adult rate, so it rises by the same percentage.
Who is affected
The minimum wage applies to workers, not just employees. That includes part-time staff, casual and agency workers, and apprentices. It does not apply to people who are genuinely self-employed.
The apprentice rate applies to apprentices under 19, and to apprentices aged 19 or over in the first year of their apprenticeship. Once an apprentice aged 19 or over has finished their first year, they must get at least the rate for their age.
When the new rate starts in your payroll
A new rate applies from the start of the first pay reference period that begins on or after the date of the change. A pay reference period is the period you pay for, such as a week or a month, and it cannot be longer than 31 days. So if you pay monthly on a cycle that does not start on the 1st, the new rate may not apply until partway through April or into May. The same rule applies when a worker has a birthday that moves them into a higher age band.
Watch out for salaried staff
The rise does not only affect people paid by the hour. If you pay an annual salary, check what it works out at per hour. For example, a salary of £25,000 for a 37.5-hour week works out at about £12.82 an hour. That is above the current £12.71, but below £13.21. Without a pay rise, that employee would be paid below the minimum from April 2027.
As a rough guide, a full-time worker on 37.5 hours a week at the National Living Wage would earn about £975 more a year at the new rate (50p × 37.5 hours × 52 weeks).
Common ways employers underpay without meaning to
Most underpayments are not deliberate. GOV.UK guidance highlights several traps:
- Salary sacrifice. Pension, cycle-to-work or other salary sacrifice schemes must not take a worker's pay below the minimum wage. A worker paid just above the rate today could fall below it after a sacrifice.
- Uniforms and equipment. If you require specific items and the worker pays for them, or you deduct the cost from pay, that reduces their pay for minimum wage purposes.
- Work-related expenses. Deductions for expenses connected with the job always reduce minimum wage pay.
- Accommodation. If you provide accommodation and charge more than the offset, the excess counts against minimum wage pay.
- Unpaid time. Make sure you are paying for all the time that counts as work, such as required training.
What happens if you get it wrong
Not paying the minimum wage is a criminal offence. HMRC can order you to pay arrears to the worker, worked out at today's rates rather than the rate at the time. It can also charge a penalty of up to 200% of the arrears, up to £20,000 per worker. The penalty is halved if you comply in full within 14 days. Employers who break the rules may also be named by the government.
You must keep pay records for at least six years, and it is up to you to show that you paid the minimum wage.
A practical checklist
- List everyone close to the minimum. Include salaried staff, and work out their effective hourly rate.
- Check age bands and apprentices. Note birthdays and apprenticeship anniversaries due in 2027.
- Review salary sacrifice and deductions. Check that pay after these stays above the new rates.
- Budget for the increase. Allow for related costs such as overtime and pension contributions that rise with pay.
- Think about pay differentials. If your lowest rate rises, decide whether supervisors and other staff need a rise too.
- Plan your payroll update. Know which pay period the new rates apply from and update your software in good time.
- Tell your staff. Confirm pay changes in writing and keep records.
How Officium can help
We can review your payroll for minimum wage risks, including salaried staff, salary sacrifice and deductions, model the cost of the April 2027 rates, and make sure the new rates go into your payroll from the right pay period.
Call us on 01942 644864 or email hello@officiumbusinessservices.co.uk to talk it through.
This article is general guidance based on GOV.UK and HMRC information as at 13 November 2026. The April 2027 rates are announced but not yet in legislation. It is not advice for your specific circumstances.