National Minimum Wage

Increase in National Minimum Wage Rates

From pay reference periods on or after 1 October 2008 the National Minimum Wage (NMW) hourly rates will increase.

From 17 July 2008 the exemption from NMW for individuals taking part in a Work Trial has been extended from three weeks to six weeks. The exemption only applies to work trials set up under Government arrangements and not to any arrangements individual workers and employers may agree between themselves.

Alongside this, regulations have been amended to clarify which individuals placed with employers as part of a Government employment programme are exempt from NMW. The amended regulations clarify that only those who are paid or entitled to be paid by their employer are entitled to NMW. The Department for Work and Pensions will provide guidance to workers and employers when they are making arrangements.

Proposed Changes to NMW Penalties and Calculation of Arrears

In Issue 29 of the online Employer Bulletin we advised you that the Employment Bill was being debated in Parliament. However the passage of the Bill through Parliament has been slower than expected and it is now expected to receive Royal Assent in October with the proposed changes now coming in to force in April 2009.

We want to help employers comply with the law without adding unnecessary administration. For advice on what records you need to keep and the information you need to be able to show to confirm you are paying the national minimum wage correctly, contact the NMW Helpline on 08456 000 678. You don’t need to keep separate NMW records if your usual payroll records show the required information.

Cadet Force Adult Volunteers, Voluntary Workers and NMW

The Employment Bill will also clarify the position for Ministry of Defence Cadet Force Adult Volunteers and enable voluntary workers to be reimbursed a broader range of expenses whilst still retaining exemption from NMW in specific circumstances. This change will take effect when the bill receives Royal Assent.