National Minimum Wage — Worker Rights vs Employer Duties

National Minimum Wage rules create mirror obligations: workers have enforceable rights to receive the correct rate, while employers carry strict duties to pay it, keep records, and face naming and prosecution if they fail. This comparison sets out both sides.

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FeatureWorker (claiming underpayment)Employer (compliance duties)
Legal basisNational Minimum Wage Act 1998 and National Minimum Wage Regulations 2015; right to be paid at least the applicable NMW rateSame legislation — employers are strictly liable regardless of agreement with the worker or business circumstances
Current rates (April 2025)National Living Wage (21+): £12.21/hour; 18–20: £10.00/hour; 16–17 and apprentices: £7.55/hourSame rates apply across all workers within each age band; accommodation offset may reduce effective wage payable (£10.66/day 2025/26)
What counts as working timeTime when required to be at work; sleep-in shifts (if required to be present and available, not merely available to be called); travel between assignmentsMust count all time workers are at work and required to be there; uniform-changing time, mandatory training, and trial shifts all count
Accommodation offsetEmployer can offset accommodation costs — but only at the prescribed offset rate (£10.66/day for 2025/26); deductions above this rate breach NMWCan only charge or offset accommodation up to the daily accommodation offset rate; any excess is treated as an unlawful deduction reducing effective hourly rate
Record-keepingWorker has a right to inspect their own pay records; can request a NMW statement from HMRC or raise a grievance if records are withheldMust keep sufficient records to show NMW compliance for each pay reference period for 3 years; must allow HMRC officers to inspect on request
Who enforcesHMRC NMW team (complaint via ACAS or online); Employment Tribunal (unpaid wages claim); civil courtHMRC NMW compliance officers investigate; powers include right to enter premises, inspect records, and issue notices of underpayment
PenaltiesNo penalty for the worker — underpayment is a debt the employer must repay plus arrears; worker keeps the money recoveredNotice of underpayment requiring arrears plus 200% penalty (min £100, max £20,000 per worker); prosecution possible for wilful non-compliance
Naming schemeWorkers are not named; the naming scheme is a reputational tool against employers that benefits workers by deterring future underpaymentEmployers who fail to pay NMW arrears are publicly named by BEIS/DBT; naming is automatic above a £500 total arrears threshold
Civil vs criminal liabilityWorker can bring civil Employment Tribunal claim for unlawful deduction from wages (3-month time limit from date of deduction)Civil liability for arrears + penalty via HMRC notice; criminal prosecution for wilful non-compliance or obstruction of HMRC officer (unlimited fine)
Complaint pathwayStep 1: raise grievance internally; Step 2: report to ACAS helpline (0300 123 1100); Step 3: lodge Employment Tribunal claim within 3 months; or report directly to HMRCVoluntarily disclose underpayments to HMRC to reduce penalties; obtain HMRC clearance; review payroll and working time calculations before HMRC investigation opens

NMW applies regardless of what the employment contract says — a contract cannot lawfully agree a rate below NMW. Workers in casual, zero-hours, or piece-rate arrangements are often the most at risk of underpayment. Contact Acas (0300 123 1100) for free guidance before escalating.

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Disclaimer

The information on this page was correct at the time of writing. Amounts, thresholds, and rules may change. Always check the latest official guidance.