THE NATIONAL MINIMUM WAGE – SOME MYTHS AND MISCONCEPTIONS
Meredith Hurst Monday, November 3, 2014
The National Minimum Wage has been in force for a number of years now. The current rate is £6.50 per hour (for workers older than 21). It has recently featured in the news, with the Labour Party promising to raise it if it gains office after next year's general election. Prior to this the government "named and shamed" a list of employers which had been found guilty of failing to comply with the minimum wage legislation.
Despite this there are a number of myths and misconceptions about the National Minimum Wage, some of which could be extremely dangerous for employers. Here are a few of them:
The National Minimum Wage does not need to be paid to "on call" workers.
This is not necessarily the case. It is correct that a worker who is genuinely "on call", with no requirement to carry out work during the periods when they are on call, even if they are required to be close to the workplace, does not need to be paid the national minimum wage when they are on call. However, simply because a worker is described as being "on call" in their contract, job description or job title, does not mean that they are not entitled to be paid the National Minimum Wage. As the Employment Appeal Tribunal noted in a recent case, the words "on call" are not found anywhere in the National Minimum Wage Act or Regulations. An Employment Tribunal should always look at the work the worker is actually carrying out. If the worker's presence is required at the workplace, particularly if they are required to be at the workplace in order to comply with a statutory obligation which the employer is under, as may be the case in the care industry, then there is a high likelihood that they will be entitled to the National Minimum Wage.
Working hours under the Minimum Wage Act are calculated in the same way as working time under the Working Time Regulations 1998.
Incorrect. The National Minimum Wage Act 1998 and the Working Time Regulations 1998 are separate pieces of legislation with very different purposes and concepts. In particular the Act is purely domestic legislation whereas the Regulations derive from European law. Neither should be used as a guide to the interpretation of the other.
A worker can only claim arrears of unpaid wages under the National Minimum Wage Act for up to six years.
Incorrect. Most claims for the National Minimum Wage in Employment Tribunals will be made as claims for unlawful deductions from pay. There is no limit on the amount of monies that can be claimed or the period within which a claim can be made, provided that the claim is presented within three month of the final deduction. If a worker has not been paid the national minimum wage since the legislation came into force and has remained with the same employer or been transferred to from employer to employer under the Transfer of Undertakings (Protection of Employment) Regulations 2006, then there is no reason why they cannot claim unpaid wages from the date the national minimum wage legislation came into force.
The National Minimum Wage does not apply to workers who come from outside the UK.
Incorrect. Every worker in the United Kingdom is entitled to be paid the National Minimum Wage.
The National Minimum Wage cannot be paid for periods when the worker is asleep.
Incorrect. It depends on the particular circumstances of each case but in general terms if a worker is required to be at work and the nature of their role is provide a presence at the workplace then there is a good chance that time spent asleep during the shift will have to be paid at the National Minimum Wage rate.
Interns are not entitled to be paid the National Minimum Wage.
An intern may be entitled to be paid the National Minimum Wage. It depends on what they are doing. The National Minimum Wage is payable to employees or workers, and a worker is defined as someone who works under either a contract of employment or any other contract whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual. If an intern is carrying out work or services then they are entitled to be paid the national minimum wage. If the intern is only shadowing other employees and is not actually required to carry out any duties then they may not fall into the definition of worker in the Act.