Employers – NMW

Employers are required to pay their workers at least the National Minimum Wage or the National Living Wage (referred to collectively as NMW below).  Those rates are:

Year 25 and over 21 to 24 18 to 20 Under 18 Apprentice
October 2016 £7.20 £6.95 £5.55 £4.00 £3.40
April 2017 £7.50 £7.05 £5.60 £4.05 £3.50


Whilst it may seem a relatively simple task to comply with the applicable rates, the regime is very complex and has caused a number of large companies to unwittingly fall in breach.  Companies such as Monsoon Accessorize, Argos, Debenhams, H&M, and Welcome Break are a few of the well-known names that have reportedly been held in breach.

Whether a worker has received the NMW will depend on their average hourly rate. This is calculated on the basis of:

– The total remuneration earned over the relevant pay reference period; and

– Divided by the total number of hours worked over the pay reference period.

Employers must retain relevant records of the hours worked and payments made to their workers.

Failure to pay the NMW may lead to enforcement by HMRC (civil courts/Employment Tribunal), prosecution by the CPS (criminal) and/or enforcement by the worker(s) (civil courts/Employment Tribunal).