The National Minimum Wage - Payroll Information from Seago & Stopps Payroll Solutions Limited
The National Minimum Wage (NMW) is the minimum hourly rate of pay that employers are obliged to pay their workers. Its rate is defined by law, and it applies to most workers in the UK over school leaving age. Exceptions include:
- Children of compulsory school age
- Self-employed individuals
- Directors of companies who do not have an employment contract
- Voluntary workers
- Family members of the employer living in the employer's home
Separate rates of pay apply to agricultural workers.
The National Minimum Wage rate is reviewed annually, with the latest rates published in October. There are different rates of NMW that apply to different groups of workers, as follows:
- The main rate for workers aged 21 and over
- The 18-20 year old rate
- The 16-17 year old rate
- The apprentice rate for apprentices under 19, or in the first year of their apprenticeship
Although the rules are complex, as a general guide benefits in kind, expenses, certain allowances and most deductions are not included when calculating NMW. Job-related training time and travelling is included in the calculation, but periods of absence, holiday, rest breaks or industrial action are not.
There are special rules for workers who are not paid according to the number of hours they are at work.
Employers must keep records to demonstrate payment of the National Minimum Wage. All records have to be kept for 3 years.
Qualifying individuals who are not paid the National Minimum Wage are entitled to apply to a court or tribunal, and are protected against any loss suffered. Employers who fail to pay the NMW are liable to financial penalties, and may be convicted of a criminal offence.
We can advise you on the latest NMW rates. For expert assistance with your payroll needs in Sudbury, contact Seago & Stopps Payroll Solutions Limited today.