# UK Minimum Wage 2027: What the £13.21 April Step Costs a Venue, Per Head and Per Year

> The National Living Wage rises from £12.71 to £13.21 on 1 April 2027, and the 18 to 20 rate from £10.85 to £11.27. Here is what that costs per head and per rota once National Insurance and pension ride on top, and what to do before April.

- Author: Alex Riesenkampff (Super44)
- Published: 2026-10-26 · Updated: 2026-10-29
- Canonical: https://super44.ai/blog/uk-national-living-wage-2027

## Key takeaways

- The UK National Living Wage rises 3.9% from £12.71 to £13.21 an hour from 1 April 2027, after the government accepted the Low Pay Commission recommendations in full on 28 October 2026.
- A 30-hour employee on the National Living Wage costs about £920 more a year from April 2027 once 15% employer National Insurance and a 3% pension ride on the extra 50p an hour.
- A venue with seven staff averaging just over 21 hours a week pays about £4,600 more a year, or about £4,000 if its whole employer National Insurance bill stays under the £10,500 Employment Allowance.
- The 18 to 20 rate rises by the same 3.9%, from £10.85 to £11.27, because the Low Pay Commission paused moving young workers onto the adult rate this year.
- The new rates apply from the first pay period that starts on or after 1 April 2027, and tips, gratuities and service charges do not count towards them.

The UK National Living Wage rises from £12.71 to £13.21 an hour on 1 April 2027. The government confirmed it on 28 October 2026, accepting the Low Pay Commission's recommendations in full. That is 50p an hour, or 3.9%. For one employee on 30 hours a week it adds about £920 a year once employer National Insurance and pension are counted. The 18 to 20 rate rises by the same 3.9%, to £11.27, so the youth-rate jump many owners were bracing for has not happened this year.

## The April 2027 rates

Every legal minimum rises by 3.9% from April 2027, and the adult rate lands slightly above the middle of the range the Commission floated in the spring. **The National Living Wage becomes £13.21 an hour from 1 April 2027, up 50p, after the government accepted the Low Pay Commission's recommendation on 28 October 2026.**

| Age band | From 1 April 2026 | From 1 April 2027 | Rise |
|---|---|---|---|
| 21 and over (National Living Wage) | £12.71 | £13.21 | 50p |
| 18 to 20 | £10.85 | £11.27 | 42p |
| 16 to 17 | £8.00 | £8.31 | 31p |
| Apprentice (under 19, or in the first year) | £8.00 | £8.31 | 31p |
| Accommodation offset, per day | £11.10 | £11.53 | 43p |

In April the Commission had put the likely rate between £13.02 and £13.34, with a central estimate of £13.18. Wages grew faster than expected over the summer, and holding the National Living Wage at two-thirds of median earnings would now have needed £13.44. The Commission chose not to go that far. Its advice says plainly why: "Hiring in retail and hospitality is particularly weak." Baroness Philippa Stroud, the Commission's Chair, put the same point more broadly:

> Economic growth has been better than expected this year, but this growth is not leading to hiring.
>
> — [Baroness Philippa Stroud, Chair, Low Pay Commission, GOV.UK announcement, 28 October 2026](https://www.gov.uk/government/news/lpc-recommendations-take-the-national-living-wage-to-1321)

Hospitality is one of the sectors where these numbers bite hardest. The Commission's 2025 report found 24.6% of hospitality jobs were covered by the National Living Wage: 334,000 jobs, almost a quarter of the sector. In a cafe or bar, that is usually the floor staff, the baristas and the kitchen porters.

There is also a voluntary benchmark. The Living Wage Foundation set the real Living Wage at £14.10 across the UK on 15 October 2026, which is still 89p above the new legal rate. Our [UK pay benchmarks by role](/blog/restaurant-wage-benchmarks-by-role) cover when paying it makes sense for a small venue.

## What the step costs for one person

Every 10p on the hourly rate costs you about 11.8p, because employer National Insurance and pension are charged on the extra pay. **A 30-hour employee costs about £920 more a year at £13.21: £780 in wages and about £140 in National Insurance and pension on top.**

The 1.18 multiplier comes from two charges. Employer National Insurance is 15% of weekly pay above £96, according to GOV.UK's rates and thresholds for 2026 to 2027. For anyone enrolled in a workplace pension, the employer minimum is 3% of pay between £6,240 and £50,270 a year. The table counts 52 weeks of pay, holiday weeks included, so there is no separate holiday loading.

| Weekly hours | Extra wages a year | Extra cost with NI and pension |
|---|---|---|
| 16 hours | £416 | £491 |
| 30 hours | £780 | £920 |
| 40 hours | £1,040 | £1,227 |

A 50p rise on today's £12.71, paid for 52 weeks. Our [employee cost calculator](/blog/employer-cost-calculator-uk) prices a whole hire, and the [true hourly cost guide](/blog/uk-employer-ni-true-hourly-cost) explains each layer.

Some people cost less than the table shows. Staff under 21, and apprentices under 25, attract no employer National Insurance on pay up to £967 a week. Anyone earning under £192 a week, such as a student doing one shift, is below the automatic enrolment trigger, so there may be no pension contribution either.

The step also reaches people who are not on the minimum today. A barista on £13.00 needs a rise by law. If you want a supervisor to stay 50p above the floor, they move to £13.71. List everyone paid under £13.71 before you decide what April costs you, because that list is usually longer than the minimum-wage headcount.

## What it costs across a whole rota

For a typical small cafe or bar rota of 150 paid hours a week, the step adds about £4,000 to £4,600 a year, and the Employment Allowance decides which end you land on. **Seven staff on just over 21 hours a week each, 150 paid hours in all, cost about £4,600 more a year at £13.21, or about £4,000 if the allowance covers the whole National Insurance bill.**

The Employment Allowance takes up to £10,500 off your employer National Insurance bill for the tax year. On their own, those seven employees owe about £9,600 a year in employer National Insurance today and about £10,200 at £13.21. Both sit inside the allowance, so the National Insurance part of the step would cost nothing.

That only holds if nobody else is on the payroll. A head chef or manager on £32,000 uses about £4,050 of the allowance alone, which pushes this venue over the limit, and then every extra pound of wages carries the full 15%. Add up the whole payroll, not just the minimum-wage staff. Our guide to the [Employment Allowance for a small venue](/blog/uk-employment-allowance-hospitality) covers who can claim. £10,500 is the 2026 to 2027 figure. The 28 October 2026 Budget left the headline National Insurance rates alone, but check the 2027 to 2028 allowance when HMRC publishes it.

**What the April 2027 rates cost your rota** *(interactive scenario explorer in the web version)*

Example (Paid hours a week at £12.71: 150 h, Paid hours a week at £10.85 (18 to 20): 0 h, On-cost on extra adult wages: 18 %, Pension on extra 18 to 20 wages: 0 %):

- **Adult staff to £13.21:** 4,602 £
- **18 to 20 staff to £11.27:** 0 £
- **Total extra cost a year:** 4,602 £

*Yearly extra cost. On-cost: 18% where 15% employer National Insurance and a 3% pension both apply; 3% where the Employment Allowance covers your whole National Insurance bill; 0% for staff under £96 a week who are not in a pension. Under-21s attract no employer National Insurance up to £967 a week and are not auto-enrolled until 22, so the youth line carries no on-cost unless they have opted into your pension; set the pension field to 3% if they have. Paid hours include holiday.*

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## The 18 to 20 band: alignment paused

For staff aged 18 to 20, April 2027 is a smaller step than recent years, because the Commission has paused moving them towards the adult rate. **The 18 to 20 rate rises 42p to £11.27, the same 3.9% as the adult rate, which adds about £655 a year in wages for a 30-hour employee no employer National Insurance, and no pension unless they have opted in.**

That breaks a pattern. In April 2026 the youth rate went up 8.5% against 4.1% for adults, the third year running it outpaced the adult rate. The government's remit had given the Commission "full flexibility" on the pace of alignment, and this year it used it. Its advice says demand for young workers has slowed, and that youth-friendly sectors such as hospitality have even fewer vacancies than a year ago.

The pause is not the end of it. The Commission says "there is still potential to lower the age limit, especially for 20 year olds", and the government's stated aim is still a single adult rate from 18. No date is set, so plan for the gap of £1.94 between £11.27 and £13.21 to start closing again from April 2028.

A 21st birthday is still the biggest single jump in your wage bill. After April, a 30-hour employee moves from £11.27 to £13.21, which adds about £3,000 in wages plus about £2,300 in employer National Insurance once the allowance is used up. That is around £5,400 a year from one birthday. If your weekend team is mostly 19 and 20 year olds, put their birthdays in the diary.

Kate Nicholls, Chair of UKHospitality, warned about exactly this pressure when the April 2026 rates were announced:

> The higher-than-expected increase to the rates for under-21s is also worrying for hospitality businesses, who had hoped the Government would take a more pragmatic approach to achieving its goal of equalising all wage rates.
>
> — [Kate Nicholls, Chair, UKHospitality, Restaurant Online, 26 November 2025](https://www.restaurantonline.co.uk/Article/2025/11/26/national-living-wage-to-increase-by-41-to-1271/)

## What to do before 1 April

Now the rate is known, the job is to price it in once, early, and keep your rota and your people. **Ten staff on 30 hours a week cost about £9,200 more a year at £13.21, which is about £177 a week to find from prices, productivity or margin.**

**From now to the first pay period after 1 April 2027**

1. **Now: price your rota at £13.21:** Cost current hours at the new rates. List everyone paid under £13.71 and decide whether supervisors keep their differential.
2. **When HMRC publishes 2027 to 2028 thresholds:** Check the Employment Allowance and National Insurance thresholds, and rerun the sums if either moves.
3. **February and March: set prices and rotas:** Decide how much goes on the price list and how much the rota absorbs, then update payroll software and written pay terms.
4. **First pay period starting on or after 1 April:** Pay the new rates, including to anyone who has turned 18 or 21 since you last checked.

*The increase applies from the first pay reference period that starts on or after the change date, according to GOV.UK.*

Cutting hours is the tempting answer, and usually the wrong one. In the Commission's 2025 report one hospitality worker describes weeks that swing between 15 and 32 hours, and a Dundee manager says staff are getting stressed about their shifts. People on unpredictable hours look for steadier work, and our [staff turnover calculator](/blog/cost-of-staff-turnover) will show you what one departure costs in your venue. Clive Price, Managing Director of Barons Pub Company, told the Morning Advertiser on 1 April 2026: "There are not many more efficiencies we can find in the business without affecting the customer experience".

Prices are usually the better lever, and the sums are smaller than they feel. One 30-hour employee costs about £17.70 a week more. A 10p rise on a coffee or a pint brings in about 8.3p after 20% VAT, so about 210 sales a week covers that person. The seven-person rota above, at about £4,600 a year, needs roughly 1,060 sales a week at 10p more. That is about 150 coffees or pints a day if you open seven days, or about 175 on six. Our guide to [raising menu prices without losing customers](/blog/raise-menu-prices-without-losing-customers) covers which items to move, and the [labour cost benchmarks](/blog/restaurant-labour-cost-percentage) show where your wage bill sits against comparable venues.

If your National Insurance bill is already close to the allowance, cost the step at the full 18%. And if you run a coffee shop that already feels busy but thin, our piece on why [a busy coffee shop can still lose money](/blog/coffee-shop-busy-but-not-profitable) shows where an extra £900 a head tends to hide.

## Paying it correctly

Getting the new rate right means paying it from the right date, to everyone it covers, in pay that counts towards the minimum. **The increase applies from the first pay reference period that starts on or after 1 April, so a monthly paid employee whose pay month begins on the 1st is owed £13.21 for the whole of April.**

Tips cannot make up a shortfall in base pay. GOV.UK says "Tips, gratuities, service charges and cover charges do not count towards minimum wage pay", whether they come through payroll, straight from customers or from a tronc. Our [tips and tronc guide](/blog/uk-tips-law-tronc-tax) covers how to share them. Uniform is the other common trap: if you require specific items and do not supply them, GOV.UK says deductions for them reduce minimum wage pay, so a uniform charge can take a low-hours worker below the line. If you provide live-in accommodation, the most you can count towards minimum wage pay rises to £11.53 a day.

Check your salaried staff as well. An assistant manager on £27,000 who works 40 hours a week all year earns about £12.98 an hour, which is under £13.21 on the hourly rate alone. Hours beyond their contracted annual total make it worse, and GOV.UK's guidance on salaried hours is plain: "You must pay the worker at least the minimum wage for the unpaid excess hours."

Underpayment does get caught. On 3 September 2026 the government named nearly 660 employers for failing to pay the minimum wage, with about £7 million in penalties and about £4 million repaid to more than 27,000 workers. It was the first naming round since the Fair Work Agency was set up.

If you are changing shift patterns at the same time, our guide to [Employment Rights Act changes for rotas](/blog/uk-employment-rights-act-rotas) covers the guaranteed-hours and notice rules that are coming. They are a separate cost from the wage floor.

## FAQ

### What is the National Living Wage from April 2027?

£13.21 an hour for workers aged 21 and over, up 50p or 3.9% from £12.71. The government announced it on 28 October 2026, accepting the Low Pay Commission's recommendations in full. The 18 to 20 rate becomes £11.27 and the under-18 and apprentice rate becomes £8.31.

### How much does a 10p rise in the minimum wage cost an employer?

About 11.8p for each hour paid to an adult above the National Insurance threshold who is enrolled in a pension, because 15% employer National Insurance and a 3% pension apply to the extra pay. For a 30-hour employee paid 52 weeks, 10p an hour is about £156 in wages and about £184 once those two on-costs are added.

### Are 18 to 20 year olds moving onto the National Living Wage in April 2027?

No. The Low Pay Commission recommended pausing alignment this year because demand for young workers has slowed, and the government accepted that. The 18 to 20 rate rises by the same 3.9% as the adult rate, to £11.27. The Commission still sees room to lower the adult age limit, especially for 20-year-olds, but has set no date.

### Do I have to give a rise to staff already above the minimum wage?

Only if their rate falls below £13.21. Anyone you pay between £12.71 and £13.21 must move up to at least £13.21 from April 2027. Keeping a gap between supervisors and floor staff is a choice, but a common one, and it adds to the cost of the step.

### From what date do I have to pay the new minimum wage?

The rates change on 1 April each year, and the increase applies from the first pay reference period that starts on or after that date. A monthly paid employee whose pay period begins on 1 April is owed the new rate for April. A weekly paid employee whose period starts on a Monday is owed it from the first Monday on or after 1 April.

### Do tips count towards the minimum wage?

No. GOV.UK says tips, gratuities, service charges and cover charges do not count towards minimum wage pay, whether they come through payroll, direct from customers or from a tronc. Base pay has to reach the legal rate before any tip is added.

## Sources

1. [GOV.UK: LPC recommendations take the National Living Wage to £13.21](https://www.gov.uk/government/news/lpc-recommendations-take-the-national-living-wage-to-1321) — Published 28 October 2026. The government accepts the Commission's recommendations in full: from April 2027, £13.21 for 21 and over, £11.27 for 18 to 20, £8.31 for 16 to 17 and apprentices, accommodation offset £11.53 a day, all up 3.9%. Quotes Baroness Philippa Stroud, Chair of the Low Pay Commission. Checked 29 October 2026.
2. [Low Pay Commission: advice to government on 2027 minimum wage rates](https://www.gov.uk/government/publications/minimum-wage-rates-for-2027/lpc-advice-to-government-on-2027-minimum-wage-rates) — Published 28 October 2026. Recommends pausing 18 to 20 alignment because demand for young workers has slowed; says "there is still potential to lower the age limit, especially for 20 year olds"; estimates two-thirds of median earnings would have needed £13.44; "Hiring in retail and hospitality is particularly weak." Checked 29 October 2026.
3. [GOV.UK: National Minimum Wage and National Living Wage rates](https://www.gov.uk/national-minimum-wage-rates) — Rates from 1 April 2026: £12.71 for age 21 and over, £10.85 for 18 to 20, £8.00 for under 18 and apprentices. Rates change on 1 April every year. Checked 26 October 2026.
4. [Low Pay Commission: 2026 consultation letter](https://www.gov.uk/government/consultations/low-pay-commission-consultation-2026/lpc-consultation-letter-2026) — Dated 1 April 2026. Gave an indicative range of £13.02 to £13.34 for April 2027, central estimate £13.18. Superseded by the 28 October 2026 recommendation. Checked 26 October 2026.
5. [Low Pay Commission Report 2025](https://www.gov.uk/government/publications/low-pay-commission-report-2025/low-pay-commission-report-2025-html) — Hospitality coverage by the National Living Wage rose from 21.9% in 2024 to 24.6% in 2025, 334,000 jobs. Checked 26 October 2026.
6. [HM Treasury: Budget 2026](https://www.gov.uk/government/publications/budget-2026-document/budget-2026-html) — Delivered 28 October 2026. No increase to the headline rates of income tax, National Insurance contributions or VAT; National Living Wage and National Minimum Wage rates up 3.9%. Checked 29 October 2026.
7. [GOV.UK: Rates and thresholds for employers 2026 to 2027](https://www.gov.uk/guidance/rates-and-thresholds-for-employers-2026-to-2027) — Employer Class 1 rate 15% above £96 a week; 0% up to £967 a week for under-21s and apprentices under 25; Employment Allowance £10,500 for 2026 to 2027. Checked 26 October 2026.
8. [The Pensions Regulator: automatic enrolment earnings thresholds](https://www.thepensionsregulator.gov.uk/business-advisers/automatic-enrolment-guide-for-business-advisers/automatic-enrolment-earnings-threshold) — Earnings trigger £10,000 a year; qualifying earnings band £6,240 to £50,270, for 2026 to 2027. Checked 26 October 2026.
9. [Low Pay Commission: The National Minimum Wage in 2026](https://www.gov.uk/government/publications/the-national-minimum-wage-in-2026/the-national-minimum-wage-in-2026) — April 2026 report: NLW £12.71 (up 4.1%), 18 to 20 rate £10.85 (up 8.5%), the third consecutive year the 18 to 20 rate rose by substantially more than the NLW. Checked 26 October 2026.
10. [GOV.UK: Workplace pensions, what you, your employer and the government pay](https://www.gov.uk/workplace-pensions/what-you-your-employer-and-the-government-pay) — Employer minimum contribution of 3% on the qualifying earnings band. Checked 26 October 2026.
11. [GOV.UK: Calculating the minimum wage](https://www.gov.uk/guidance/calculating-the-minimum-wage/calculating-the-minimum-wage) — Pay reference periods and the rule that an increase applies from the first period starting on or after the change; tips, gratuities, service charges and cover charges do not count; deductions for required uniform reduce minimum wage pay. Checked 26 October 2026.
12. [GOV.UK: Working hours for which the minimum wage must be paid](https://www.gov.uk/guidance/calculating-the-minimum-wage/working-hours-for-which-the-minimum-wage-must-be-paid) — Salaried hours work: "You must pay the worker at least the minimum wage for the unpaid excess hours." Checked 26 October 2026.
13. [GOV.UK: nearly 660 employers announced as failing to pay the minimum wage](https://www.gov.uk/government/news/short-changing-staff-isnt-a-shortcut-to-success-nearly-660-employers-announced-as-failing-to-pay-the-minimum-wage) — Published 3 September 2026. Round 24, the first since the Fair Work Agency was set up: nearly 660 employers, about £7 million in penalties, about £4 million repaid to more than 27,000 workers. Checked 26 October 2026.
14. [Living Wage Foundation: real Living Wage 2026](https://www.livingwage.org.uk/news/real-living-wage-increases-%C2%A31410-uk-and-%C2%A31545-london) — Announced 15 October 2026: £14.10 an hour in the UK, 65p or 4.8% up. A voluntary rate. Checked 26 October 2026.
15. [Restaurant Online: National Living Wage to increase by 4.1% to £12.71](https://www.restaurantonline.co.uk/Article/2025/11/26/national-living-wage-to-increase-by-41-to-1271/) — Kate Nicholls, Chair of UKHospitality, 26 November 2025, on the April 2026 rates and the under-21 increase.
16. [Morning Advertiser: impact of national minimum wage hikes on pubs](https://www.morningadvertiser.co.uk/Article/2026/04/01/impact-of-national-minimum-wage-hikes-on-pubs) — Clive Price, Managing Director of Barons Pub Company, 1 April 2026.