Government confirms rises in minimum wage

Government confirms rises in minimum wage

The Government has confirmed that the National Minimum Wage will increase from 1 October 2010.

Currently From 1 October 2010
Standard (adult) rate(Age 22 and over) £5.80 Standard (adult) rate(Age 21 and over) £5.93
Development rate(age 18-21) £4.83 Development rate(age 18-20) £4.92
Young workers rate(aged under 18 but above the compulsory school age who are not apprentices) £3.57 Young workers rate(aged under 18 but above the compulsory school age who are not apprentices) £3.64
Apprentices Apprentices aged 16 to 18, and apprentices over the age of 19 for the first 12 months of their apprenticeship, are currently not entitled to the NMWBUT must be paid £95 per week under Learning and Skills Council requirements Apprentices(apprentices under 19 years of age or those aged 19 and over but in the first year of their apprenticeship) £2.50
Accommodation offset £4.51 Accommodation offset £4.61

The national minimum wage (NMW) was introduced in 1999 by the National Minimum Wage Act 1998 (NMWA 1998). It gives workers the right to a specified minimum hourly rate of pay. The employer is under the obligation to pay the NMW, and there are no exclusions for smaller employers. Calculating the amount paid for the purposes of the NMW can be relatively complex as various rules relating to both the relevant pay period and hours worked apply. Additionally certain payments and benefits can be taken into account, or deducted making the calculation less than straightforward. Some groups of people will fall outside the NMW protection because of the nature of their work, for example family members living and working at home but paying nothing for food and board will not be entitled to receive the NMW. Employers are obliged to keep certain records and how these to employees if they receive request to view them.

Failure to pay the NMW can be expensive for employers as employees can claim backdated pay up to the minimum wage going back historically, and failure to pay the NMW will be a breach of contract. Workers also get special protection form dismissal or detriment for bringing claims in relation to the NMW or raising issues with employers.  HM Revenue and Customs (HMRC) can also enforce breaches and in some cases criminal prosecutions may result.

Government guidance on the NMW is available on the websites for Business Link, Direct Gov and the Department for Business Innovation and Skills.

For help with legal issues relating to the NMW or employment law generally contact Victoria Young on 01473 343922 or email vy@blockslegal.co.uk

The above is general comment only and individual advice should be taken.