The minimum wage is an important legal consideration for all
employers. Current legislation states that a minimum hourly rate must be paid
to all employees above the age at which compulsory education ends. From 1
October 2001 the National Minimum Wage was increased to £4.10 for workers aged
22 or over. The NMW youth rate for workers aged between 18-21 years, or 22 and
over on accredited training, has risen from £3.20 per hour to £3.50 per
hour.
The minimum wage is decided by the Secretary of State and is subject
to change. It is wise for employers to familiarise themselves with all current
legislation in this area, and to make sure that their employees are aware of
such issues. Providing each member of staff with a copy of the guidelines is a
good idea, as is posting a copy on a company noticeboard.
Make sure you keep and maintain records of employees receiving the
minimum wage, both to keep the issue in mind and also for taxation purposes.
Employees should be fully aware of their right to the minimum wage and should
be informed of any changes in legislation. It is therefore essential that the
employer review the guidelines at regular intervals.
The following factors should be taken into account when considering
the minimum wage:
The age of employees: the legal age at which a person can
begin work must be considered when taking on new staff. If the individual is
still receiving compulsory education, he or she is not legally entitled to
receive the minimum wage. Current legislation on this subject should be
consulted. Also, the date when the employee becomes eligible for the minimum
wage should be noted
Paid and unpaid absence: make workers aware of the terms and
conditions of employment with respect to illness-related absence and paid and
unpaid holidays
Commission-based earnings: this form of payment is considered
outside the scope of the minimum wage legislation and therefore separate
guidelines should be consulted
The fairness of the wage: the level of work performed by
employees, taking into account responsibility and effort, should be considered
when deciding upon the appropriate wage for the workers. Details on pay
increases, and how to work towards them should be readily available to
employees
