Change to National Mininum Wage
26 September 2008
Whilst you are probably well aware of the changes due from 1 October 2008, we thought we would remind you about them as follows...
- Employees 22 and over - the rate will rise to £5.73
- Employees aged 18-21 - the rate will rise to £4.77
- Employees aged 16 and 17 - the rate will rise to £3.53
It is reported that more than £27m in unpaid wages has been recovered on behalf of 80,000 workers since 1999.
It is well worth noting that the Government is proposing to crack down on employers who do not pay the correct amount and will impose a change that will create a clearer deterrent. This penalty will mean that any arrears of the National Minimum Wage owed to any employee who has been paid less than the NMW will be calculated by reference to the current rate of NMW when the current rate is higher than the rate in force at the time of the underpayment. This means that the employee will be repaid any underpayment of NMW by the employer at a higher rate if the NMW rate has increased since they were underpaid.
In addition to this the change will also include that powers will be given to HMRC officers in obtaining NMW information from employers, allowing them to take information away from the employer’s premises in order to copy it. For serious cases it could become a criminal offence triable in the Crown Court. This change is likely to come into force on 6 April 2009.
Therefore, you are advised to review your pay rates and annual salaries to ensure that the increases are applied with effect from 1st October.
For more information visit http://www.berr.gov.uk/whatwedo/employment/pay/national-minimum-wage/
Alternatively, for an informal chat about this or any other people management issues you may have, just call us or come and visit us in our new offices.