HM Revenue & Customs (HMRC) has recently named 70 offenders who have failed to pay the National Minimum Wage (NMW).

Currently, the NMW adult rate (21 and over) is £6.50 per hour with an annual October update. There are three other rates, an apprentice rate, a 16-17 year old rate and an 18-20 year old rate.

There are a number of common problems, the main one relates to apprentices. The apprentice rate (the lowest at currently £2.73 per hour) applies to 16-18 years and those who are 19 years and over who are in their first year. All other apprentices are entitled to the NMW based on their age.

An easy error is failing to notice an employee who moves from the 17 year old rate to the 18 year old rate.

Where workers are provided with accommodation, this also needs to be taken into account as it can affect the NMW calculation.

The 70 offenders range from a business in Nottingham who failed to pay over £37,000 to 184 workers (an average of £200 each) to a business in Durham who failed to pay just over £100 to one employee. So, for the sake of failing to pay just over £100 the business is now named and shamed. 

We have seen a rise in these enquiries as HMRC check through business records to check the accuracy. A number of these enquiries are started following complaints by current or ex-employees.

This is becoming a very emotive subject as no doubt you will have seen the recent news that even the Church of England has come in for a lot of criticism for advertising jobs below the living wage. (The living wage is slightly higher than the NMW and is calculated according to the basic cost of living in the UK. The current rate for outside London is £7.85).

If you are in any doubt about what is and isn’t included in the NMW, then please contact us and we will advise you on how not to become one of HMRC's statistics.

Telephone us on 01472 345888 or email me on we will be more than happy to set your mind at rest.

Agree? Disagree? Do let Unknown know what you think by commenting below.

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