Karen’s first job was a paper round. She earned £1.50 per week for tramping around the streets at the crack of dawn in all weathers, posting papers through nasty, snapping letterboxes and trying to avoid nasty, snapping dogs.
OK, so that was a long time ago, and earnings have increased since then.
These days, almost all employees are entitled to earn a minimum amount per hour, by law. As an employer – even if you only have one member of staff – you have to comply with the regulations.
You therefore need to be aware that new regulations come into force from 1 April 2016.
National Living Wage
There are two main changes you need to be aware of:
The Regulatory Policy Committee estimates these changes will cost private sector employers an extra £1.1 billion. This sum is made up of £700 million to meet the new NLW, plus £137.5 million to pay additional pensions and National Insurance contributions.
It is planned to increase the NLW to 60% of average earnings by 2020, expected to be over £9 per hour.
National Minimum Wage Chart
If your contract with your employee is for payments below the minimum wage, it’s not legally binding.
In order to qualify for the National Minimum Wage, workers must be of school leaving age or over, on the last Friday in June of the school year they turn 16.
Your workers are entitled to be paid minimum wage even if they are part-time, casual labourers, agency workers, homeworkers, apprentices, trainees, on probation, disabled, foreign, or offshore.
Those who don’t qualify include company directors, volunteers, students, family members who live in your home, workers younger than school leaving age, and prisoners.
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