There is now in effect in the United Kingdom a National Living Wage and National Minimum Wage for those under 25.

This is the minimum amount of gross pay per hour that an employer must pay an employee depending upon their age.

National Living wage for workers over 25

is £7.20 per hour

National Minimum Wage – People aged 21 to 24
must be paid at least £6.95 per hour

National Minimum Wage – Between the ages of 18 and 20
an employee must be paid at least £5.03 per hour

National Minimum Wage – Under 18
an employee must be paid at least £4.00 per hour

National Minimum Wage – Apprentices
an apprentice must be paid £3.40 per hour

The remuneration being received by an employee will be made up of many items such as a basic wage, bonuses, incentives, in some cases accommodation, clothing allowances, shift allowances etc. What is allowed and what is not allowed in calculation of the basic minimum wage is dependent on each case and expert advice should be sought.

The hours for which the employer must pay at least the national minimum wage are calculated differently according to the type of work done. There are four types of work:

  • Employees paid for working a set number of hours, or a set period of time, are doing timework
  • Employees who have a contract to work for a set number of basic hours each year in return for an annual salary paid in equal instalments (for example each week or each month), are doing salaried hours work
  • Employees paid according to the number of things they produce or the number of deals or sales that they make are doing output work. In this case there is an option for the employee to have a written agreement with the employer stating a ‘fair estimate’ of the number of hours they should work.
  • If the employees have to do a number of specific tasks, but do not have any set hours, they are doing unmeasured work. Again, there is an option for them to have a written agreement with their employer setting out the average number of hours they should work each day.

If an employee is entitled to the national minimum wage, the employer cannot force him/her to accept a lower rate of pay. Even if the employee has signed a contract agreeing to receive a lower rate of pay, this will have no legal effect.

If the employee thinks that he/she is being paid less than the national minimum wage, the employee has a right to see his/her records about it. As long as the employee makes his/her request in writing, the employer must by Law supply the records within 14 days. If the employer refuses to let the employee see his/her records, the employee can lodge a complaint with an Employment Tribunal (which, if it upholds the complaint, will order the employer to pay compensation equivalent to 80 hours’ pay at the minimum wage rate).

If an employer fails to pay at least the national minimum wage, a complaint can be lodged with an enforcement agency. Employees are legally protected against being sacked or victimised by employers over their entitlement to the national minimum wage and over any action they may take to enforce their rights through the Employment Tribunals.