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National and Minimum Wage Increases: What you need to know!

With the National Living Wage and National Minimum wages being increased this week, we have set out the increases below and a few easy mistakes which employers often don’t take into consideration when thinking about the minimum wage. 

The National Living Wage: 

The National Living Wage came into effect in 2016, providing legislation for employers to pay anyone over the age of 25 years and above a minimum amount. 

Currently the living wage is set at £8.21 per hour but this is set to increase to £8.72 an hour from the 1st of April 2020 providing those who fall into this bracket an extra £1000 a year to their pay. 

The National Minimum wage: 

The National Minimum wage covers 4 age brackets and falls into 4 basic categories those aged 21 – 24 years, 18 – 20 years, 18 and below and those students who are currently earning though their apprenticeships. 

The table below sets out current minimum pay for the above brackets and the increases set to take place on the 1st of April 2020.

Image result for the national living wage 2020

Although most companies aim to always remain compliant when it comes to the above minimum wages, there are some common mistakes employers can fall short on.

  • Including Tips as part of their wage. 
  • Uniform requirements that push employees below the minimum wage. 
  • Not updating an employee’s wage when they move into the next age bracket or keeping track. 
  • Not including time to change into uniform, team meetings and briefings and traveling between work meetings or different work sites. 

These are easy enough mistakes but they have a big impact on employees being paid less and a big impact on you as the employer, not only does it take time to correct these mistakes, it can also have a detrimental effect on the business reputation and even cause legal cases to be raised and prosecution against the company. 

Its imperative employers make sure processes and procedures are in place, good systems and technology and that HR and Payroll staff are fully up to speed with any updates and changes. 

If you are getting set for the increase and would like some further advice, please get in touch and we would be happy to assist.