All workers (except limited excluded categories) are entitled to be paid no less than the NMW. The NMW is reviewed annually and at present (from 1st April 2017) is as follows:
- Workers who are over compulsory school leaving age (16 years) but under 18 years: the rate is £4.05 per hour
- Workers aged between 18 years and 21 years: the rate is £5.60 per hour
- Workers 21 years and over: the rate is £7.05 per hour
- Workers 25 years and over: the rate is £7.50 per hour
There are special rates for those undertaking an apprenticeship or those on government training schemes. The apprentice rate is £3.50 per hour.
The rate of pay is calculated by reference to all remuneration payable and therefore includes commission, tips and bonuses. The rate of pay is assessed over the workers pay period – usually weekly or monthly. There are detailed regulations which cover the calculation of which working hours count towards the assessment.
Employers must maintain written records of hours worked by staff - and the worker is entitled to require the employer to produce copies of those records (failure to do so can lead to a financial award in favour of the employee by an employment tribunal).
Failure to pay the NMW entitles the employee to bring an application in the employment tribunal or the County Court. The burden of proof is reversed, so that it is for the employer to prove that he is paying the minimum wage.
In addition to the rights of employees to enforce the NMW regulations the Inland Revenue may also undertake investigations to ensure compliance, including the power to issue enforcement notices and require the payment of back pay. Remedy can be very expensive. Repeated or wilful breach of the regulations can lead to criminal proceedings being taken against offending employees.