Are you sure you are paying National Minimum Wage?
Over the years we have seen many big companies receive large fines for failing to pay the National Minimum Wage, or National Living Wage to their employees. More often than not, those big companies have not realised, or forgotten, various elements of "working time" that need to be included in the calculation of employees' pay.
If such big names can get it wrong, what hope is there for smaller organisations?
You may be thinking that you have nothing to worry about, as you are confident that you are paying the appropriate minimum rates for your employees.
But if you expect your staff to do any of the following, you may well find you are actually paying below minimum wage:
• Be at work 10-15 minutes before their shift begins, so that they can be ready to start work on time.
• Work through part, or all, of their breaks to get the job done.
• Stay on duty until customers leave the premises, which might be after their official paid working hours end.
• Clean up after their shift ends.
• Go through security checks after their shift ends.
• Attend briefings before, or after, their paid working hours begin or end.
• Travel between sites or clients as part of their working day.
. Provide their own uniform
. Repay training costs if they leave their employment
• Have monies deducted from their wages for uniforms, breakages or because the cash till was short at the end of their shift.
In short, if you are paying national minimum wage (or living wage) rates to your staff, you need to be sure you are paying them for anything that could constitute working time, or genuine work expenses. Cleaning up, locking up, security checks and attending briefings or work-related events are all working time, while uniform, breakages and till shortfalls are all genuine work expenses. As the employer, you need to ensure that what they are left with after deductions still meets the relevant National Minimum/Living Wage thresholds.
Some employers have been named and shamed because they had failed to increase hourly rates when employees moved into a new age category. So make sure your pay records are up to date, and the person responsible for payroll is checking dates of birth regularly.
Another way of ensuring you don’t fall foul of the minimum wage rates may be to have a minimum hourly rate for your staff that exceeds the statutory minimum, so that even with additional time worked above, the hourly rate does not fall below the statutory levels. While it might cost you more in terms of headline salary budget, it could save you money in the long run if it saves you an expensive tribunal claim.
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