National minimum wage - the basics and who is entitled to it

Who must get the national minimum wage - workers, agency workers, agricultural workers, homeworkers

Workers

Most workers in the UK over compulsory school age are entitled to be paid at least the national minimum wage (NMW).

If you have a contract of employment, then you are a worker for the purposes of NMW. Even if you do not have a contract of employment, you are still a worker if you are doing work personally for someone else under a worker's contract, such as a contract to personally perform services, and you are not genuinely self-employed. The contract does not need to be written - it may be an implied contract or an oral contract.

People such as homeworkers, agency workers, casual labourers, part-time workers and workers on short-term contracts are all entitled to the NMW.

It does not matter when or how a worker is paid - eg a worker may be paid by the month, week, day, session or hour and by cash, cheque, bank transfer or any other method.

Agency workers

If someone is supplied by an agent or agency to do work for somebody else, he is a worker for NMW purposes and must be paid at least the NMW. The agency worker will be entitled to the NMW and whoever pays them, generally the agency, will be responsible for paying the NMW.

Agricultural workers

Agricultural workers covered by agricultural wages legislation, are entitled to the agricultural minimum wage (AMW) rather than the NMW. No agricultural worker may be paid less than the NMW. Some agricultural workers must be paid more than the NMW because there is a higher AMW rate - see the page in this guide on agricultural workers and the national minimum wage.

Homeworkers

Homeworkers are entitled to the NMW unless they are running their own business and are genuinely self-employed. If a homeworker is working for another person or company they are probably entitled to the NMW, even if the supplier of the work tells them that they are self-employed.

The NMW must be paid to workers who work at home as well as to those who work at your premises or elsewhere away from home. Homeworkers must receive at least the NMW, even if they pass some of the work to others such as close friends or family.

Many homeworkers are paid according to the amount of work they complete. If they are paid according to their output, ie by piece rates, then they may be rated as output workers for NMW purposes. If so, you have one of two options:

• pay the worker the NMW for every hour they actually work
• pay a fair piece rate for every piece made or task performed - see our guide on the national minimum wage - hours for which the NMW must be paid

Homeworkers should not simply rely on their tax status to determine whether they are a worker or are self-employed, as a person who has been assessed as 'self-employed' by HM Revenue & Customs for tax purposes will not necessarily be self-employed for the purposes of the NMW. If you are unsure you can call the Pay and Work Rights Helpline on Tel 0800 917 2368 for advice.

Subjects covered in this guide

• Introduction
• National minimum wage - the basics
• Who must get the national minimum wage - workers, agency workers, agricultural workers, homeworkers
• Who must get the national minimum wage - piece/output workers, commission workers, workers with a disability, seafarers
• Who must get the national minimum wage - offshore workers, trainees and probationers, workers from or working outside the UK
• Agricultural workers and the national minimum wage
• Who need not get the national minimum wage - self-employed, directors and some apprentices
• Who need not get the national minimum wage - government and European schemes and programmes
• Who need not get the national minimum wage - work experience and internships
• Who need not get the national minimum wage - family, friends, armed forces, prisoners and fishermen
• Who need not get the national minimum wage - volunteers and voluntary workers
• Who need not get the national minimum wage - religious communities, homeless and therapeutic workers
• Tables and examples on the national minimum wage and who is entitled to it

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