National Minimum Wage

Don’t misinterpret the rules – ensure you are complying with National Minimum Wage

More than 200 firms, including WH Smith, Marks & Spencer and Argos have recently been named for failing to pay their staff the National Minimum Wage. Breaches included the failure to reimburse staff for buying specified uniform and temporary colleagues not being paid within the time periods specified within the regulations.

Although errors have been swiftly rectified, firms found to not be following the law can be subjected to hefty fines and tribunal claims which could have been avoided.

The Low Pay Commission estimates that there were around 1.6 million workers paid at or below the minimum wage in April 2022, equalling around 5% of all UK workers. Therefore, this is a stark reminder for the majority of businesses that nobody is exempt from adhering to the law.

Our Employment team discusses the ways in which businesses can ensure they are complying with National Minimum Wage and National Living Wage, and how employees can assert their right to be paid correctly.

What should businesses do?

The government have stated that:

“Paying the legal minimum wage is non-negotiable and all businesses, whatever their size, should know better than to short-change hard-working staff”

Therefore, employers should:

• Keep written records which show that you are paying workers minimum wage for all time worked. These should be kept for at least 6 years if they were created on or after 1 April 2021 or had to be kept on 31 March 2021 under the previous rule that records must be kept for 3 years;
• Ensure that tips, extra pay for working bank holidays or overtime, uniforms, training courses or advanced pay do not count towards minimum wage; and
• Seek guidance from an employment law solicitor to ensure your contracts are compliant.

What does this mean for workers?

If you believe that you not been paid in accordance with minimum wage, we urge employees to:

• Complain to your employer informally and ask they rectify the problem;
• Make a formal complaint to your employer by raising a grievance;
• Complain directly to HMRC; or
• Seek legal advice if you would like to make a tribunal claim. This must be submitted within 3 months minus 1 day of the problem first occurring.

If you are unsure if you are being paid minimum wage, the government’s National Minimum Wage and Living Wage calculator for workers can be found here: https://www.gov.uk/am-i-getting-minimum-wage

Contact us

Annalie King, Head of our Employment Team or Rosie Brighty Employment Paralegal at Kerseys Solicitors in Ipswich 01473 213311 or Kerseys Solicitors in Colchester 01206 584584 or email [email protected].

Kerseys Solicitors are just a click away visit our website and click “Call Me Back” and a member of our employment team will be happy to contact you at a time that is convenient to you.

Calculating the minimum wage – Enforcing the minimum wage – Guidance – GOV.UK (www.gov.uk)