There is no excuse for not paying your employees the National Minimum Wage. The Government takes a robust stance on this and publishes an annual ‘name and shame’ list of companies who fail to abide by the law. From David Southall, Employment Law Consultant at ELAS.
It’s vital that companies take steps to ensure that they are complying with current legislation regarding National Minimum Wage and National Living Wage. Employers who pay under the minimum amounts or falsify records face legal action on two fronts. An employee may take them to an Employment Tribunal and/or make a complaint to HMRC who can issue a notice of arrears which, if not paid, can result in fines of up to £20K and 200 percent of the amount owed. The employer can also be banned from being a Director for up to 15 years and as we see from reports today, attracting negative media attention may have an incalculable effect on their future business and ability to attract the right staff.”
Top ten list of excuses for avoiding the NMW
1: The employee wasn’t a good worker so I didn’t think they deserved to be paid the NMW
2: It’s part of UK culture not to pay young workers for the first three months as they have to prove their worth first
3: I thought it was ok to pay foreign workers below the NMW as they aren’t British and therefore don’t have the right to be paid it
4: She doesn’t deserve the NMW because she only makes the teas and sweeps the floors
5: I’ve got an agreement with my workers that I won’t pay them the NMW; they understand and even signed a contract to this effect
6: My accountant and I speak a different language – he doesn’t understand me and that’s why he doesn’t pay my workers the correct wages
7: My workers like to think of themselves as being self-employed and the NMW doesn’t apply to people who work for themselves
8: My workers are often just on standby when there are no customers in the shop; I only pay them for when they are actually serving someone
9: My employee is still learning so they aren’t entitled to the NMW
10: The NMW doesn’t apply to my business
The current minimum wage rates are:
National Living Wage (age 25+) – £7.20 per hour
National Minimum Wage (age 21+) £6.70 per hour
18-20 year olds – £5.30 per hour
16-17 year olds – £3.87 per hour
Apprentice rate – £3.30 per hour **applicable to apprentices aged 16-18 and those aged 19 years and over who are in their first year. All other apprentices are entitled to the NMW for their age.
From 1 April 2017 they will increase to:
National Living Wage (age 25+) – £7.50 per hour
National Minimum Wage (age 21+) – £7.05 per hour
18-20 year olds – £5.60 per hour
16-17 year olds – £4.05 per hour
Apprentice rate – £3.50 per hour
