The National Minimum Wage for salon & barbershop owners

Our free expert guide to the NMW and NLW is available to NHBF Members only. It includes detailed information about how the NMW and NLW impact the hair, beauty and barbering industry. Find out more about becoming a Member and join now for less than 85p a day.

Legal back up and support from the NHBF 

The NHBF offers a wide range of invaluable benefits including our unique 24/7, 365 days a year legal helpline for hair and beauty employment and HR issues – which is completely free for NHBF Members.

This indispensable legal backup provides sound and practical advice on how to deal with a range of common employment issues, from contracts, apprenticeship agreements, absence and holidays, to redundancy, managing staff performance and maternity arrangements.

Download our free guide to apprenticeships.

Difference between the Real Living Wage and National Living Wage?

Since 21 November 2023, the real living wage has increased to £12 across the UK and £13.15 in London.

The Real Living Wage (RLW) is only voluntary, so businesses and employers cannot be compelled to pay it. This differs from the National Living Wage, which is Government-backed and set in law, so businesses and employers must pay it.  Around 14,000 employers currently sign up to the Real Living Wage.

The RLW is calculated by the Living Wage Foundation, a campaigning organisation, and is based directly on cost of living.

The Real Living Wage is for everyone aged 18 and over, whereas the National Living Wage is for anyone aged 23 and over.

Stay up to date

• NLW and NMW rates change every year. Always check to make sure you are paying your salon or barbershop employees the right amount.
• It’s also important to keep on top of staff birthdays – your employee may be entitled to a higher rate of pay at some point during the year. It’s a good idea to set up automatic alerts on your computer system.
• If you have an accountant, don’t rely on them to alert you to rate rises and possible underpayments – make sure you understand what’s required and that everyone working in your salon or barbershop is being paid correctly. Remember: if you get something wrong you will be liable, not your payroll provider.

What if you realise you're not paying an employee enough?

Don’t panic! Put things right first, then notify HMRC. You will need to pay your salon or barbershop employee any arrears that you owe them and make sure they are on the correct rate from now on. To notify HMRC, employers can send a quick email to voluntarydeclaration.nmw@hmrc.gov.uk

What could happen if you don’t pay the NLW or NMW?

Be aware that an employee or ex-employee would be entitled to report you to the HMRC which could result in an investigation and a fine of up to £20,000 per worker. You could also be publicly named and shamed by the government.

Coping with the costs of paying the NLW and NMW

There are three pieces of key advice when managing your budget: plan, plan, plan. To ensure the continued success and profitability of your salon or barbershop it’s vital to create a cash flow forecast.

You could also take positive steps to increase your income through innovation. For example, by offering new services or increasing your retail sales.

Thirdly, make sure you are making the most of marketing possibilities to boost your income by attracting new clients to your salon or barbershop. Find out how to market your salon for (almost) free.

This guide will help you understand the basics of financial management for your business including tax, VAT, accounting and record keeping. It’s available to NHBF Members only. Not yet a Member? Join today.

What the NHBF says ...

Hair and beauty businesses facing financial pressures due to the pandemic should ensure they are getting all the support they are entitled to from the government. Details vary across the four nations, but schemes such as furlough and self-employment grants are UK-wide, as is the ban on eviction for non-payment of rent on commercial premises until 31 March 2021. In addition, each nation is offering its own grants and funding schemes.

The NHBF campaigns at the highest levels on behalf of its Members to get the best outcomes for your business. Find out more.

Checklist 

• Make sure you know what the NLW and NMW rates are.
• Understand apprenticeships rates and don’t be caught out.
• Take positive action if you realise you are underpaying.
• Don’t underpay by mistake – for example, tips can’t be counted towards wages.
• Keep on top of staff birthdays – they may be entitled to an age-related pay rise during the year.
• Avoid being ‘named and shamed’ by the government.
• Take positive steps to boost your income to help cover costs.

More from the NHBF

Bookmark our website to make sure you’re up to date with all the latest news, views, information and advice relating to the hair, beauty and barbering industry.

Simply register for free to download these in-depth expert guides:

• Starting up
• Salon software
• Apprenticeships
• Pensions

Read more of our brilliant blog posts to gain expert business insights into key hair, beauty and barbering issues.

Become an NHBF Member for less than 85p a day to take advantage of our range of additional support tools and services to help you grow a profitable business.