Are you paying your apprentices correctly?

15 February 2026 | posted in Payroll

Apprentice pay: The top 5 mistakes catching UK employers out

Employers in the UK are regularly getting apprentice pay wrong, with 1 in 5 young apprentices being illegally underpaid according to a recent government survey.

Apprentices in the UK are entitled to a minimum wage of £7.55 per hour (increasing to £8.00 per hour from 1 April 2026 as part of the National Minimum Wage (NMW) increases announced in the UK Budget.)

Getting apprenticeship pay wrong can have serious consequences for employers and business owners. If an HMRC compliance check finds you’ve underpaid your apprentices, the penalty is 200% of the underpayment for each worker with a minimum charge of £100 per notice and a maximum charge of £20,000 per worker. In addition, businesses who pay below National Minimum Wage are publicly named in a government press release.

To make sure you’re supporting your apprentices and staying compliant with the rules, we’ve identified the most common mistakes employers make when paying apprentices and how to avoid them:

1: Paying apprentice wage before the apprenticeship has started or after it has finished

Example:

Jessica is 18 years old and starts working at a firm of solicitors on 1 June with a view to starting a Business Administration Apprenticeship on 1 September after successful completion of a three-month probation period.

From 1 June to 31 August, Jessica should be paid at least the minimum wage for a worker aged between 18 and 20. She should not be paid the apprentice rate until her apprenticeship officially starts on 1 September.

Employers need to pay the apprentice rate when the apprenticeship actually starts. If a worker starts with the employer, for example, a few months before the apprenticeship itself starts, they need to pay workers at least NMW rates for their age.

2: Not paying apprentices for their training hours

Example:

Paveen is an apprentice dental nurse. In addition to 25 hours of onsite, on-the-job training, she is also expected to do one day a week (5 hours) at college.

Any required studying or training counts as ‘working time’ for minimum wage purposes and must be paid. Paveen must be paid for both the onsite work, and the additional time spent studying at college – so 30 hours in total.

For NMW purposes the time apprentices spend on training is classed as working time and should be paid. It does not matter if this training takes place in the workplace at a college, training provider, at home or online and it may be outside normal working hours.

Training time covers all activities associated with the training – including any associated travel time.

3: Paying someone at the apprenticeship rate after the first year of their apprenticeship if they’re aged 19 or over

Example:

Gurdeep is 21 years old and starts his apprenticeship as a civil engineering technician on 1 March. Gurdeep can be paid at the apprentice rate for the first year of his apprenticeship (i.e. until 28 February the following year.) However, after the first 12 months, Gurdeep’s wage should be paid at least the national minimum wage rate for someone aged 21 and over. He should not continue to be paid at the apprentice rate.

Apprentices are entitled to the minimum wage for their age if they are aged 19 or over AND have completed the first year of their apprenticeship.

4: Paying a worker an apprenticeship rate when they’re not an apprentice

Example:

Jacob is 20 years old and is working as a warehouse operative. His employers have told him he is an apprentice and he is being paid at the apprentice rate. However, he is not on a recognised apprenticeship scheme and other than his first day, there has been no on-the-job training and his work doesn’t vary from day to day.

A worker must be on a genuine apprenticeship to qualify for the apprenticeship rate. A worker is unlikely to be considered an apprentice if the sole purpose of their training is to perform a specific job.

In this example, Jacob is unlikely to qualify as a genuine apprentice and must be paid at least the correct minimum wage rate for all hours worked.

To qualify for the apprentice minimum wage rate, the employee must be either employed on an apprenticeship scheme or engaged under a contract of apprenticeship. If treated as employed under a Contract of Apprenticeship the apprenticeship must last for at least a year and up to five years with the main purpose of teaching skills.

5: Making deductions from an apprentices pay (including salary sacrifice schemes) which take their pay below the minimum wage

Example:

Alice is 25 and works 40 hours a week as an apprentice hairdresser. She earns £12.50 per hour or £500 a week. Alice pays £15 per week to rent her uniform and equipment.

This means Alice makes £485 per week (£500 minus £15) which is £12.13 per hour. This is below the minimum wage rate of £12.21.

To calculate Alice’s minimum wage, her employer must deduct the equipment rental from the pay and will need to pay the arrears back to Alice.

Employers risk underpaying apprentices if they are making wage deductions or requiring worker payments. Salary sacrifice schemes (such as pension salary sacrifice) are another area that can trip employers up – if employers and workers decide on salary sacrifice, the employer must make sure the salary sacrifice does not reduce pay below NMW rates and that they are paying workers at least NMW after the salary sacrifice is taken.