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A
national minimum wage (NMW) has been introduced from 1 April 2000
The
National Minimum Wage Commission was established in 1997 and its report
was published in April 1998. Its
basic recommendation was that there should be a single national minimum
hourly wage for all adults. The
commission took the view that the appropriate rate was £4.40 per hour.
The recently negotiated Programme for Prosperity and Fairness (PPF)
includes a commitment to introduce the minimum wage and to increase the
set amount over the next few years.
The PPF agrees that
the rate should be £4.40 from 1 April 2000, £4.70 from 1 July 2001 and
£5.00 from 1 October 2002.
Who is covered by the legislation?
Virtually all employees over the age of 18 are covered, including public
servants. Close relatives
of the employer, and statutory apprentices are excluded.
Statutory apprentices are those who are following the regulated
periods of apprenticeship for specific trades e.g. carpenters, electricians.
Their conditions of employment and training are governed by law
already.
Reckonable pay
Virtually all payments you receive can be regarded as making up your pay
for the purpose of the national minimum wage.
These payments include your basic pay, shift premium, all productivity
related payments such as piece and incentive rates, commission and bonuses,
allowances for special or additional duties, the monetary value of
board with lodgings. The
following payments may not be included in reckonable pay - tips and gratuities, Sunday premium, unsociable hours premium, public
holiday premium, benefits in kind.
Who isn't covered
A number of employees are not entitled to the national minimum wage. Employees
under age 18 are entitled to 70% of the NMW i.e. £3.08 per hour from 1
April 2000.
Trainee Rates
People undertaking a prescribed course of study or training authorised
by the employer must be paid at least 75% of the NMW in the first year,
80% in the second year and 90% in the third.
If the course or training period is less than 3 years, the percentages
apply to each third of the time.
Enforcement
Every employee will have the right to get a written statement of his/her
average hourly rate of pay during a particular pay reference period in
the immediate past 12 months-- the employer must accede to a request for
such a statement within 4 weeks.
This should establish whether or not the provisions of the legislation
have been met.
Offence
It will be an offence for an employer to refuse or to fail to pay an employee
the entitlement to the NMW. There
are various provisions for ensuring that the employer does pay.
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