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Updates from the Clayton & Brewill team.
National Minimum Wage: new rates for 1 October 2015
The National Minimum Wage (NMW) goes up for all workers from Thursday 1 October 2015. Julie Braithwaite, payroll services specialist in Clayton & Brewill’s Nottingham office sets out the increases.
Adult workers and apprentices see the biggest rises to their National Minimum Wage (NMW) payments, with 20 pence and 57 pence increases respectively.
21 and over: increases from £6.50 to £6.70
18 to 20 years old: increases from £5.13 to £5.20
Under 18’s: increases from £3.79 to £3.87
Apprentices: increases from £2.73 to £3.30
These rates will come into force on Thursday 1 October 2015 and apply to pay periods starting on or after this date.
New National Minimum Wage rates; tougher enforcement!
Julie Braithwaite
We are well-used to the NMW going up each October but it is clear that HMRC is taking enforcement increasingly seriously and has reportedly doubled the budget for enforcement actions against employers who fail to pay workers the national minimum wage.
HMRC can carry out random checks or follow up a worker’s complaint. Arrears have to settled immediately and, as well as the hefty maximum penalty of £20,000 per worker, there is also the government’s ‘name and shame‘ policy.
Employers who are found to have deliberately underpaid workers can also, from April 2016, be disqualified as a director for up to 15 years.
All workers are entitled to the national minimum wage including pieceworkers, home workers, agency workers, commission workers, part-time workers and casual workers. There are no exemptions according to size of business or by sector, job or region.
The only people not entitled to the NMW are the genuinely self-employed, volunteers and voluntary workers, and company directors.
You must keep records for at least three years to prove you are paying the NMW – payroll records are usually the best proof. This will also be the same for the National Living Wage.
Get ready for the National Living Wage – April 2016
From April 2016 the National Living Wage will begin to be phased in. The government aims to get all workers aged 25 years and over to an hourly rate of just over £9 by 2020.
From April 2016, the National Living Wage for workers aged 25 and over will be set at £7.20.
Workers aged 24 and under will remain on the standard National Minimum Wage levels.