Minimum Wages

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National Minimum Wage and National Living Wage

HMRC wishes to raise awareness of the new rates of pay that will come into force when the National Minimum Wage and National Living Wage increase on 1 April 2018 to ensure that all employers are at least paying their staff the legal minimum.

A website to assist employers is available and employers and employees can contact Acas for advice and support on a wide range of employment rights and responsibilities (or call 0300 123 1100 from Monday to Friday, 8am to 6pm but check your call costs first as they vary from 3p to 40p per minute).

HMRC also want to encourage low-paid workers to come forward to make sure they are getting the wages they are legally entitled to. They are looking to raise worker’s awareness of their entitlement and asking them to report any under-payments for HMRC to investigate if necessary.

HMRC believe that many people who are paid the National Minimum Wage or National Living Wage still lose out on their full entitlement because of a series of common errors made by their employers. Workers often don’t realise that they are being short-changed and that it’s possible for them to get back the money they are owed.

The new rates of pay per hour after 1 April 2018 will be:

For Apprentices in their first year or under 19:         £3.70
For employees under 18:                                            £4.20
For employees aged 18 – 20:                                     £5.90
For employees aged 21 – 24:                                     £7.38
For employees 25 and over:                                       £7.83

Comment from GMPA, “Under-payment of the minimum wage is a major issue of in-work poverty, particularly exploiting workers from marginalised groups. We fully support HMRC in encouraging low-paid workers to come forward to make sure they are not being underpaid. However we take issue with the description of the minimum wage as a “National Living Wage”, which is misleading and confusing for employers and the wider public and does not reflect what is needed to achieve a decent standard of living. 

The real Living Wage is an hourly rate independently calculated to be enough for a decent minimum standard of living. That rate is £8.75/hr outside London, a new rate is calculated and announced every November in Living Wage Week, and we encourage  employers to voluntarily commit to paying all of their staff that rate, and to become accredited as Living Wage Employers. Almost 150 employers across Greater Manchester have been accredited as Living Wage Employers, including Salford City Council, the GM Chamber of Commerce, and many businesses and charities. 

The so-called National Living Wage is a rebrand of the minimum wage, but it is not a living wage as it is not based on the cost of living. It could also be argued that it is not truly national as it does not apply to people under the age of 25. This distinction is important because both the minimum wage and the real Living Wage are valuable tools in the bid to end in-work poverty, and should not be allowed to confuse or to distract from each other. Please see the Living Wage Foundation’s explanation for further information.

 

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