As specialist employment law solicitors Employment Solicitors Manchester offer a complete range of advice and support in every aspect of National Minimum Wage and National Living Wage compliance.
The National Minimum Wage was instigated on the 1st April 1999 according to legislation under the National Minimum Wage Act 1998. It was introduced to establish all employees from school leavers to retirement were guaranteed a minimum hourly rate of pay according to their age. The rates of pay eligible for both National Minimum Wage and the National Living Wage are reviewed and increased on the 1st April each year.
Workers aged 25 years old and above must be paid the National Living Wage whereas workers under the age of 25 years old will be paid the National Minimum Wage.
The rules and legislation according to both the minimum and living wage can be complex and require professional guidance in resolving any challenges in accordance with the law and funding.
The Inland Revenue are entitled to undertake investigations to ensure correct compliance to the minimum wage regulations with the power to enforce payment of back pay and fines. Repeated or wilful breach can lead to criminal proceedings against offending employers.
National Minimum Wage & National Living Wage Hourly Rates
From April 2019, minimum pay rates will increase as below:
- NLW (workers aged 25+) — from £7.83 to £8.21 per hour.
- Workers aged 21–24 — from £7.38 to £7.70 per hour
- Workers aged 18–20 — from £5.90 to £6.15 per hour
- Workers aged 16–18 — from £4.20 to £4.35 per hour
- Apprentice rate — from £3.70 to £3.90 per hour.
There is a special rate for workers employed under an apprentice scheme that are aged under 19 years old or aged 19 years and over for the first year of their scheme – this rate currently stands at £3.70 per hour. Apprentices over 19 years old and in their second year of a scheme are entitled to the National Minimum Wage, the rate depending on their age at that time.
Exceptions To The National Minimum & National Living Wage
You are not entitled to the minimum wage in the following circumstances:
- If you are self-employed
- If you are under 16 years old
- If you are a non-executive company director
- If you are living or working with a family as an au pair or a nanny and not paying towards your accommodation or your meals
- If you are in the armed forces
- If you are a volunteer or taking part in work experience
- If you are a prisoner
- Some trainees and interns are not entitled, however this area is complex and any worker unsure of their rights should contact us for accurate guidance
- Some farm workers; again, this is a complicated area so if in doubt contact our specialist team for clarification of your rights
All other workers in employment should be paid according to the National Minimum Wage and National Living Wage guidelines. This includes pieceworkers, home workers, agency workers, commission workers, part-time employees and casual workers.
What Counts Towards National Minimum Wage & National Living Wage
You should be paid the minimum wage rate for your age in relation to:
- Your basic salary
- Any bonus, commissions or incentive payments based on performance
- Specific accommodation allowances
- Additional allowances paid by the way of HM Revenue & Customs dispensation agreements.
Areas that don’t constitute the minimum of living wage rates are:
- Other benefits that may or may not have monetary value
- Loans from your employer
- Advances of wages
- Pension payments
- Retirement payments
- Redundancy or settlement payments
- Premium pay for overtime or shift work
- Allowances that are not attributable to employee performance, for example, an on call allowance
- Repayment of expenses spent in connection with the job
- Expenses for travel to a temporary workplace eligible for tax relief under the Income Tax (Earnings and Pensions) Act
- Tips and gratuities paid through payroll
- Some payments in respect of absences
Areas Of Complication
You may need our expert guidance in certain areas of what is expected to be included in employment schedules and working hours. Please contact us for confirmation of the law in regards to:
- Being paid for travelling on business, for example, between appointments or to meetings with clients, travelling to conferences and training
- Time spent in training and on training courses
- Time spent being on call
- Employer deductions for accommodation
- Family members: a worker who is a member of the employer’s family, living in the family home and who shares family tasks and activities
- Employees who live in the employer’s family home who are not members of their family but are treated as such by being provided food and accommodation and sharing in the family tasks and activities; who are not liable to deductions or make payments to the employer for provision of food and accommodation; or if the work undertaken would not be classed as work if performed by a member of the employer’s family
Failure To Pay The National Minimum And Living Wage
It is against the law for an employer to not pay staff the minimum or living wage. It is also against the law for any employer to falsify records of payment to show compliance where the rules have been broken.
If an employee isn’t being paid the correct rate for their age then they should attempt to resolve the situation by discussing the shortfall with their employer. If a verbal request fails to provide resolution then the employee should submit a written complaint – this is known as a grievance.
If there is still no suitable resolve then the employee can approach the HMRC (HM Revenue & Customs) to investigate their legal standing or raise an employment tribunal to formalise their complaint. The employee must choose one or the other. They cannot apply for both areas of resolution.
Awards For Non-Compliance To National Minimum Wage & National Living Wage Rates
If your claim against your employer is successful there is a maximum fine for non-payment of £20,000. If an employer refuses to pay the fine they will be banned from the role of company director for up to 15 years.
Contact Employment Solicitors Manchester Now
As specialist employment solicitors we can guide you in the correct process and guidance of legislation in matters of:
- Establishing employee payment schedules
- Eligible employee hours pertaining to the National Minimum Wage
- Hourly rates applicable to different shifts, shift patterns and weekend work
- Confirming if allowance payments constitute to National Minimum Wage rates
- Confirming allowances to working times including training, study and travel
- Confirmation of the rules pertaining to night time shifts or where workers spend time asleep
You can call on 0161 82 11 559 or contact us by clicking here for an initial consultation regarding all of your employment concerns. We offer complete and full advice in easy to understand terms to help establish the most likely outcomes for your case in a relaxed and pressure free environment.
We understand how sensitive making a claim against your employer can be so our expertly trained staff deliver each of our services with empathy and understanding. It is entirely up to you whether you decide to pursue your claim or not. We’re here to help you make those important decisions backed by our years of experience and industry knowledge.