UK salon employer costs in 2026: National Living Wage, employer NI, sick pay, holiday pay and tips

Conrad James
Conrad James
October 19, 2026
4 min read
Employing UK salon staff in 2026: the £12.71 National Living Wage, 15% employer NI, day-one sick pay, irregular-hours holiday pay and tipping rules.

Employing salon staff in the UK costs more in 2026. The National Living Wage is £12.71 an hour from 1 April 2026. Employers pay 15% National Insurance on earnings above £5,000 a year. Statutory Sick Pay is now paid from day one. Irregular-hours staff accrue holiday at 12.07% of hours worked. And all tips must be passed on to workers under the tipping law. Here are the rules with their dates and official sources.

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Updated 19 October 2026. General information, not legal, tax or payroll advice. Check gov.uk, HMRC and Acas, or ask your accountant.

National Living Wage and minimum wage

From 1 April 2026: £12.71 an hour for workers aged 21 and over (up 4.1%), £10.85 for 18–20 year olds (up 8.5%), and £8.00 for 16–17 year olds and apprentices (GOV.UK). Apprentices aged 19 or over who have finished the first year of their apprenticeship get the rate for their age (GOV.UK). The government says the increase adds £977 a year to the gross pay of a National Living Wage worker on 37.5 hours a week (GOV.UK). Rates change every April; the April 2027 rates hadn't been announced when we checked.

Employer National Insurance

Since 6 April 2025, the employer (secondary Class 1) rate is 15%, up from 13.8%, and it applies to earnings above £5,000 a year, down from £9,100. The maximum Employment Allowance, which reduces eligible employers' NI bills, rose from £5,000 to £10,500 (HMRC Employer Bulletin). Check with your accountant whether you can claim it.

Statutory Sick Pay from day one

From 6 April 2026, SSP is paid from the first day of sickness absence rather than the fourth, and there's no lower earnings limit any more, so part-time staff on low hours qualify. SSP is paid at the lower of £123.25 a week or 80% of average weekly earnings (GOV.UK; Acas).

Holiday pay for irregular-hours and part-year staff

For leave years starting on or after 1 April 2024, irregular-hours and part-year workers accrue holiday at 12.07% of the hours they work in each pay period, up to 28 days a year (Working Time Regulations, reg. 15B). Employers may pay these workers rolled-up holiday pay: at least 12.07% of total pay each pay period, paid at the same time and shown as a separate item on the payslip (Acas). Rolled-up holiday pay isn't allowed for regular-hours staff (GOV.UK).

Tips and service charges

Under the Employment (Allocation of Tips) Act 2023, employers must pass all tips and service charges to workers without deductions (apart from limited cases such as income tax), distribute them fairly and transparently, keep a written tipping policy available to all workers, keep records, and pay tips out by the end of the month after the month they were paid (GOV.UK code of practice). The written policy is required where tips are paid more than occasionally (legislation.gov.uk). The Employment Rights Act 2025 adds a duty to consult workers when writing or revising a tipping policy; the government's timeline lists strengthening tipping law for the end of 2026 (GOV.UK).

What's coming next

From 1 January 2027, the unfair dismissal qualifying period falls to six months, and guaranteed-hours rights are expected in 2027. See the Employment Rights Act 2025 for salon employers.

How salons are coping

  • Protect every booked hour with deposits and reminders. See should your salon require a deposit?.
  • Fill cancellations fast from a waitlist rather than leaving paid staff idle.
  • Review prices once a year against costs. See how to raise your salon prices.
  • Keep stylists on clients, not on the phone, and stop paying for desk hours that mostly cover quiet times.

Where CallPad helps

CallPad is an AI receptionist for salons, spas and clinics. It answers every call 24/7, including evenings, Sundays and the Saturday rush, without adding staff hours. It books, moves and cancels appointments in real time on supported booking systems, so your team isn't pulled out of services to pick up the phone, and the calls that come in while everyone is busy still turn into bookings. It sends missed-call text-backs, texts clients on your waitlist when a slot opens up, and can take a deposit on the call by texting a payment link or using a card on file in your booking system. When a caller needs a person, it can transfer the call to a team member or take a message. Setup takes about 10 minutes, and CallPad plans are quote-based.

Related guides

Frequently asked questions

What is the minimum wage for UK salon staff in 2026?

From 1 April 2026, the National Living Wage is £12.71 an hour for workers aged 21 and over, £10.85 for 18–20 year olds and £8.00 for 16–17 year olds and apprentices.

What is the employer National Insurance rate?

Since 6 April 2025, employers pay 15% on earnings above £5,000 a year. The maximum Employment Allowance is £10,500 for eligible employers.

How is holiday calculated for irregular-hours salon staff?

For leave years starting on or after 1 April 2024, irregular-hours and part-year workers accrue holiday at 12.07% of hours worked each pay period, and employers may pay rolled-up holiday pay at 12.07% of total pay, shown separately on the payslip.

Do UK salons have to pass on all tips?

Yes. Under the Employment (Allocation of Tips) Act 2023, employers must pass all tips and service charges to workers without deductions (apart from limited cases such as income tax), allocate them fairly, keep a written policy where tips are paid more than occasionally, and keep records.

Can CallPad reduce front desk costs?

CallPad answers every call 24/7 without adding staff hours and books, moves and cancels appointments in real time on supported booking systems, so stylists stay with clients and calls outside desk hours still get booked. CallPad plans are quote-based.

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