Quarterly News

Minimum wage changes ahead.

It has been announced that the new National Minimum Wage (NMW) rates from 1 October 2008 will be as follows:

Workers aged 22 and over - £5.73 (£5.52) per hour

Workers aged 18-21 - £4.77 (£4.60) per hour

Workers aged 16-17 - £3.53 (£3.40) per hour

The NMW is an important cornerstone of government strategy aimed at providing employees with decent minimum standards of pay. The government are also proposing a number of changes to how the NMW is enforced, with the intention that these new provisions will come into force on 1 October 2008.

The intention is to create a clearer deterrent to non compliant businesses and to provide a fairer way of dealing with arrears of NMW. The proposed changes will introduce:

• a new method of calculating arrears for workers who have been underpaid;
• a penalty payment for employers who do not pay their workers the NMW;
• new inspection powers for NMW compliance officers; and
• a strengthening of the criminal regime for NMW offences.

HMRC are currently responsible for enforcing the operation of the NMW rules. The rules cannot be enforced by HMRC across all businesses at the same time, so HMRC have opted to look at particular business sectors in turn. Sectors which HMRC are currently interested in are hairdressing, childcare provision and the hospitality industry.

If you have any concerns or questions about the NMW rules, please do get in touch.

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