belfasttelegraph

Friday 24 May 2013

Working Brief: NMW a benefit to employees and employers

From today the National Minimum Wage (NMW) will increase again.





Workers aged 22 years and over will be entitled to a minimum of £5.52 per hour and workers aged 18-21 will be entitled to at least £4.60 per hour. The rate for 16 and 17-year-old workers will also increase to £3.40 per hour.



The NMW was introduced as a statutory employment right in 1999 as part of the Government's commitment to eradicating poverty in work.



The rates have steadily increased over the years and it is predicted that over one million low paid workers in the United Kingdom benefit each year from the rate rise.



Nearly all workers are entitled to the NMW regardless of the hours they work, their occupation, skills level or size of the business.



In some cases apprentices or trainees may be exempt from the NMW for a specified period of time in order to encourage their training and development within the workplace.



NMW legislation is enforced by Her Majesty's Revenue and Customs (HMRC) compliance teams and it is an employer's responsibility to be able to prove that their staff are being paid correctly.



Since the legislation was introduced over £24m has been identified in arrears of wages across the UK - including over £2.2m in Northern Ireland alone.



Employers who are found not to be paying the NMW will be ordered to raise the wages to the appropriate level and to pay arrears to workers who have been underpaid.



The Low Pay Commission, which reports to the Government on the impact of the NMW and makes recommendations, has identified eight areas of the economy where low pay is common. These include retail, hospitality, social care, hairdressing and food processing.



In an effort to combat these areas HMRC runs programmes of targeted enforcement where it aims to enable and educate employers in these sectors.



Last year HMRC's targeted enforcement campaign was aimed at the child care sector, while this year the HMRC targeted enforcement will be aimed at the hotel industry.



Research has shown that the NMW stops employers paying poverty wages in order to undercut competitors and that very low wages result in high staff turnover, unskilled workers, low productivity and dissatisfied customers.



By outlawing low levels of pay the legislation is designed to help minimise in-work poverty and to attract more people into work.



Citizens Advice operates the National Minimum Wage Helpline for Northern Ireland and offers impartial and confidential advice to workers and employers on all aspects of the NMW.



Anyone seeking further information can contact an NMW adviser on 0845 6500 207, Monday to Friday between 9am and 5pm.











Lucy Cochrane is an information and policy officer for Citizens Advice.



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