How the Living Wage Differentiates from the Minimum Wage
The government introduced the National Minimum Wage and National Living wage rates in April 2016. These are designed to ensure that low paid workers receive a decent standard of living. They apply to everyone working in the UK including those employed by businesses that don’t provide accommodation. The National Living Wage rate is set at the equivalent of the national minimum wage rate plus 0.6%.
The National Living Wage rate rises every year according to the Consumer Price Index (CPI). In 2017 it rose to £8.21 per hour, increasing again in 2018 to £9.15 per hour. By 2020 the rate will reach £10.30 per hour.
If you fail to pay the required wages, you could face fines or penalties. You could also be charged with an offence under the Employment Rights Act 1996.
Current rates
The current rates for the National Minimum Wage and National Living Wage are £7.50 per hour and £9 per hour respectively. This is set to rise annually until 2020.
Apprentices
The government has announced plans to introduce apprenticeships for young people aged 16 to 18. They will be able to earn up to £3,250 a year while gaining qualifications.
Under the plan, those aged 16 to 18 will be eligible to take part in apprenticeship schemes. These include construction, engineering, health and social care, and manufacturing.
They will be expected to spend at least 30 hours a week working towards their qualification. This includes paid internships, where employers agree to provide training free of charge.
In addition, apprentices will receive holiday pay. Employers will be required to give workers at least 28 days off over a rolling 12-month period.
This follows a consultation launched earlier this year, which received more than 10,000 responses.
A spokesperson for the Department for Education told HuffPost UK: “We want every child to reach their full potential and we know that many young people don’t realize how much they could be earning – so today’s announcement builds on our commitment to help young people into employment.”
Previous rates
The previous minimum wage for employees aged 25 and over was £6.31 per hour. This rose to £7.05 per hour on 1 January 2016. On 1 October 2018 it increased again to £7.50 per hour. However, the government announced plans to raise the national living wage (NMW) to £9 per hour by 2021.
In addition, there are some exemptions to the NMW. Apprentices under 18 years old do not qualify for the NMW; however, those aged 19 to 21 do qualify. There are also exemptions for certain groups including people working fewer than 24 hours a week, students, carers and people caring for someone else.
Who gets the minimum wage
The government sets the minimum wage in each country. There are different rates depending on where you live. In some countries you might even make less than the national minimum wage. But it doesn’t end there. You might also earn additional payments for working overtime or being part of a union.
In the UK, workers aged over 25 must be paid the National Living Wage, which is £7.50 per hour (£9.40 per hour for those under 25). Workers aged 21 and 22 must be paid the Youth Rate, which is £4.05 per hour. Those aged 18 to 20 can be paid up to the age of 19, when they reach full adult status. Under EU law, workers aged 16 and 17 cannot be forced into employment without parental consent. They must be given the opportunity to refuse such work.
Entitlement to the National Minimum Wage (NMW)
Most workers in the UK over the age of 18 are legally entitled to receive at least the national minimum wage. This includes employees working through agencies, self-employed people, freelancers and those who work part-time hours. However, there are some exceptions; young people aged 16 and 17 are exempt from receiving the NMW if they are students attending full-time education or training. Those aged 18 to 20 are also exempt if they are studying towards a degree or diploma.
The law says that employers must pay you the national miniumum wage even if you do not take tips or commissions. You are also eligible for sick pay, holiday pay, maternity/paternity pay, and flexible working hours.
Even though you are employed through a recruitment agency, you still qualify to receive the NMW.
The National Minimum Wage and Work experience
The National Minimum Wage (NMW) is one of the most important pieces of legislation affecting UK employers. This article explains what it covers, how it works and why it matters.
How does the NMW apply?
The NMW applies to all employees working for organisations in the UK for 35 hours or more each week. Organisations include both public bodies such as local councils, NHS trusts and universities, and private companies including retail chains, restaurants and hotels.
What does the NMW cover?
The NMW aims to ensure that people doing low-paid jobs are properly rewarded. It sets out basic standards of pay and conditions for those people who do low-paid work. These include:
• A national hourly wage floor, which is set at £7.50 per hour (£9.05 per hour for apprentices).
• A national weekly maximum salary limit, which is set at either £110 per week (£130 per week for apprentices) or £155 per week (£185 per week for apprentices), whichever is lower.
Making the National Minimum Wage Calculation
The National Minimum Wage is determined by the Fair Labor Standards Act. While it applies to most workers across the United States, there are some exceptions. For example, overtime pay isn’t required for employees who work less than 30 hours per week. Also, employers aren’t required to pay holiday pay or pay for public holidays. Some states have their own minimum wages, too.
Pay that is considered for the NMW
The National Minimum Wage (NMW) came into effect on April 1st 2018. As part of the introduction, HM Revenue & Customs (HMRC) introduced a number of changes to how it calculates the NMW. However, there are some exceptions to the rules around what does and does not count towards the NMW. Here we explain how the NMW works and how it affects you.
Payments to your employer and deductions from your pay
If your employer deducts or pays you less than the National Minimum Wage (NMW), it could mean that you’ve been underpaid. You might think that deductions and payments made to your employers don’t affect your NMPW pay, but they do.
Your employer must give you notice about deductions and payments before making the changes. This includes refunds of any money you spend on your job.
You can find out how much you earn by looking up your gross earnings online. These include wages, tips, bonuses and overtime. You’ll also see what deductions and payments your employer makes.
If you’re paid less than £7.50 per hour, you should ask why and whether there are any ways you can improve your situation.
Accommodations for the National Minimum Wage
Accommodation charges include rent, utilities, food and drink costs, cleaning and maintenance, and security deposits. Your employer may also deduct money for things like broadband internet access, laundry facilities, gym membership, car parking, pets, and travel expenses.
The National Living Wage is £7.50 per hour for workers aged 25 and over and £6.70 per hour for those aged 21 to 24. This includes a national living wage premium of 10% above the national minimum wage.
If your employer provides you with accommodation, it must pay you the national living wage plus the national minimum wage premium.
Your employer cannot charge you for accommodation if it pays you the national living wage. However, if your employer charges you for accommodation, you are entitled to claim it off against your earnings under the national minimum wage. You do not need to prove whether your employer charged you for accommodation or not.
Frequently Asked Questions
Do I earn the real Living Wage?
The government announced a national living wage of £7.20 for workers aged 21 and above in April 2016. This was seen as a victory for campaigners such as the Living Wage Foundation who had been pushing for a higher figure since 2010.
However, there are some important caveats to this announcement. First off, the hourly pay rate does not take into account how much you actually need to survive. Secondly, the government’s definition of what constitutes a living wage is far too low. Thirdly, it doesn’t consider the fact that many people working part-time cannot afford to live on just the minimum wage.
The National Minimum Wage Committee, set up under Labour in 2000, defines what a living wage is. They say it must cover basic costs including rent, food, clothing, heating, and transport. A living wage is therefore calculated differently depending on where you live. For example, in London, it is £9.30 per hour while in Scotland it is £8.35. These figures do not take into account housing benefits, childcare costs, or tax credits.
In reality, most people work longer hours than required to make ends meet. The average full-time worker works 47 hours per week compared to 38 hours recommended by the Office for Budget Responsibility.
How to complain to HMRC if you’re not paid correctly
HMRC says it receives about 10 million calls each year. In 2018 alone, it received over 2.5 billion calls. But what happens if you don’t receive the correct national minimum wage (NMW)? Do you have to settle for less money? Or do you have a legal right to the NMW?
If you think you might be shortchanged, check whether any of these common mistakes applies to you.
You might be due a pay rise, or even better wages. If you aren’t getting paid the NMW, speak to your employer. And if that doesn’t work, try calling the Acas helplines for free and confidential advice.
