Workers' Rights Under the National Minimum Wage

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Yellow Belt
If workers believe they aren't receiving the minimum wage they can phone the National Minimum Wage Helpline. This is part of the initiative the government set up to try to make the law work.

Apart from this helpline there is also a network of 16 teams of national minimum wage Compliance Officers.

All suspected cases of underpayment are investigated. Workers who don't receive the minimum wage may also claim it through an employment tribunal or civil court.

Workers dismissed for asserting their right to the minimum wage will be considered as unfairly dismissed. They have the right to take a case to a tribunal if this occurs.

Employees entitlement to the national minimum wage

The vast majority of adult workers in the UK, (but not the Channel Islands and the Isle of Man), are entitled to be paid the national minimum wage. That doesn't cover the self-employed

For the purposes of calculating NMW entitlement, 'adult workers' includes groups such as:

* part-time workers
* casual labourers
* agency workers
* piece workers, including homeworkers

Even if workers don't have a written contract of employment they are still entitled to the national minimum wage and the average pay of workers for their actual pay periods must not fall below it.

The hours for which workers must be paid the NMW depend on the types of work they do.

There are exemptions

Although the majority of workers in the UK are legally entitled to the NMW, there are limited exemptions for certain groups of workers.

Included are:

* The genuinely self-employed.
* Voluntary workers.
* Workers who are based permanently outside the UK or who are based in the Channel Islands or the Isle of Man.
* Apprentices under the age of 19 or those aged 19 and over who are in the first year of their apprenticeship.
* Workers who are still of compulsory school age - see our guide to employing young people.
* Students on a work placement of less than one year that forms part of a UK further education or higher education course.
* Residential members of a charitable community, the purpose of which is to practise or promote a belief of a religious or similar nature.
* Those employed in a Jobcentre Plus Work Trial - but only for the first six weeks of the trial - and those taking part in some government employment programmes. Jobcentre Plus will advise when making the arrangements.

Only particular elements of a worker's pay count as national minimum wage pay. This is calculated as follows:

1. Take the total gross pay.
2. Subtract payments and deductions that do not count as gross pay.
3. Divide this amount by the total number of hours worked in the "pay reference period", eg a week, fortnight or four weeks.

Total gross pay will include allowable payments and deductions such as bonuses, deductions for income tax, National Insurance contributions and workers' pension contributions. However, some payments and expenses do not count as gross pay. These payments may include loans, pension payments, redundancy payments, overtime and extra payment for unpopular shifts, eg night shifts.

Workers' expenses as part of a job, travel costs when doing the job and accommodation above a certain limit are all deductions that do not count towards minimum wage pay.

Some employees receive some benefits in kind such as meals, fuel, a car or employer pension contributions which do not count towards the minimum wage.

There is a limit on the amount of accommodation payments that can count towards NMW pay. That limit is known as the accommodation offset, which is currently set at £31.22 per week (£4.46 per day).

Without question the national minimum wage has improved the finacila situation with possibly millions of workers. Some employers seemed worried at first that having to pay the NMW would harm their profits to a damaging level, and could cause them to have to make redundancies, or even to close down. Happily, this hasn't proved to be the case with the vast majority of businesses.

Applying the National Minimum Wage
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