What is the minimum wage in the UK? Common myths about hourly pay and overtime

If you're an employee or job seeker in the UK, understanding what is the minimum wage and how hourly pay translates into annual salary is essential. Many people hold misconceptions about overtime, London weighting, and the difference between hourly and salaried roles. This article uses official data from GOV.UK, the Office for National Statistics (ONS), and NHS Employers to set the record straight.

Myth 1: The minimum wage is a single rate for everyone

In fact, the UK has several minimum wage rates depending on age and apprenticeship status. From April 2026, the National Living Wage (for workers aged 21 and over) is £12.71 per hour. Workers aged 18 to 20 receive £10.85, while those under 18 and apprentices get £8.00 per hour. These rates are set by the government and increase each April. The 2025/26 rates were £12.21, £10.00, and £7.55 respectively, as confirmed by GOV.UK National Living Wage rates.

Myth 2: Annual salary is simply hourly rate × 2,080 hours

Many people assume a 40-hour week and 52 weeks, giving 2,080 hours. However, UK full-time hours often range from 35 to 37.5 hours per week, especially in the public sector. The ONS Annual Survey of Hours and Earnings (ASHE) for 2025 shows median full-time weekly earnings of £766.60, which at 37.5 hours gives an hourly rate of about £20.44 – not £19.67, because the median includes all full-time workers regardless of hours. The correct conversion is: annual salary ≈ hourly rate × weekly contracted hours × 52. For example, the National Living Wage at 37.5 hours per week yields roughly £24,785 per year. Use our Hourly to Salary calculator for your own figures.

Myth 3: Overtime is always paid at time-and-a-half

There is no UK law requiring overtime to be paid at a premium rate. Your employment contract determines overtime pay. Many salaried employees, especially in professional roles, have a 'consolidated' salary that covers extra hours. Hourly workers may receive overtime at their normal rate or a higher rate, but the minimum wage applies to every hour worked. Always check your contract and speak to your HR department if unsure.

Myth 4: London weighting is the same everywhere

London weighting varies by employer and sector. For example, NHS Employers pay scales for 2026/27 include Higher Cost Area Supplements (HCAS) of 15% or 20% of basic salary, with minimum and maximum payments. A Band 5 nurse in inner London might earn £19.68 per hour (entry) plus HCAS, while the same role in outer London gets a lower supplement. Private sector London allowances can be flat amounts or percentages. Always factor in location when comparing hourly rates.

Real-world benchmarks: NHS pay scales and median earnings

The NHS is one of the UK's largest employers and its pay bands are a useful reference. In 2026/27, Band 1 (closed to new entrants) starts at £25,272 annual (£12.92 hourly). Band 5 (newly qualified nurses) starts at £16.40 hourly, rising to £19.97. Band 9 tops out at £138,529 annual (£70.85 hourly). These rates include HCAS for London areas. Meanwhile, the ONS reports that median gross annual earnings for full-time employees were £39,039 in April 2025, up 4.3% from the previous year. That equates to roughly £20.02 per hour at 37.5 hours.

How to use hourly-to-salary conversions wisely

When converting your hourly rate to an annual figure, remember:

• Use your contracted weekly hours, not the maximum you could work.
• Exclude unpaid overtime, bonuses, tips, and salary sacrifice.
• Account for unpaid breaks if your contract specifies them.
• Consider London weighting or other location allowances separately.

For more detailed data, visit our salary data page, which includes historical minimum wage rates and median earnings by occupation.

Summary

Knowing what is the minimum wage is just the start. The UK's tiered system means your age and apprenticeship status matter. Converting hourly to annual requires the correct hours assumption. Overtime rules are not universal, and location supplements can significantly boost take-home pay. Always refer to official sources like GOV.UK and the ONS, and check your own contract for precise terms.

FAQs

What is the minimum wage for someone aged 20 in 2026? From April 2026, the National Minimum Wage for workers aged 18 to 20 is £10.85 per hour. This is lower than the National Living Wage (£12.71) which applies to those aged 21 and over. The rates are set by the government and reviewed annually.

How do I convert my hourly rate to an annual salary? A common rule of thumb is to multiply your hourly rate by your weekly contracted hours and then by 52 weeks. For example, £12.71 per hour × 37.5 hours × 52 weeks ≈ £24,785 per year. However, actual annual pay may differ if you work overtime, have unpaid breaks, or receive bonuses. Always check your contract.

Is overtime always paid at a higher rate? No. There is no legal requirement in the UK to pay overtime at a premium rate (e.g., time-and-a-half). Your contract sets the overtime terms. Many salaried roles include overtime in the annual salary, while hourly workers may get extra pay. The minimum wage still applies to all hours worked, including overtime.