National Living Wage and National Minimum Wage.
It’s not long until the 1st of April 2016, when the government will introduce the new mandatory National Living Wage for workers aged 25 and above – an increase of 50p per hour on the current Minimum Wage (£6.70 per hour) for this age group to £7.20 per hour.
The National Minimum Wage of £6.70 will continue to apply for those aged 21 to 24, with the premium added only for those aged 25 and over.
It is vitally important that you audit and review any employee salaries that may fall into this new bracket to ensure compliance before the implementation date.
The government will impose fines and criminal prosecutions against any employers found not to be paying legal minimum wages.
The government has announced a package of measures to enforce the National Minimum Wage and National Living Wage from its introduction in April. While the overall maximum penalty for underpayment of the wage will stay the same at £20,000 per worker, new measures include doubling the penalties for non-payment of the statutory rates from 100% to 200% of the arrears (halved if employers pay within 14 days), and introducing a new team of HMRC Compliance Officers to investigate the most serious cases and bring criminal prosecutions against employers for deliberate non-compliance.
Business Secretary Sajid Javid said there is “no excuse for employers flouting minimum wage rules” and the new measures “will ensure those who do try and cheat staff out of pay will feel the full force of the law”.
The government has said it will improve the compliance guidance available to employers. In the meantime, if you have any questions or would like any support or advice we’re here to help: makeithappen@mbsmih.com 01903 688789
