National Minimum Wages Changes
The National Minimum Wage (NMW) is the minimum amount of money per hour to which workers in the UK are entitled. It is reviewed yearly by the government, which is advised by the Low Pay Commission (an independent body). As of 1 April 2017, the National Minimum Wage will be increasing to the following amounts:
- £7.50 for workers aged 25 or over
- £7.05 for workers aged 21 to 24
- £5.60 for workers aged 18-20
- £4.05 for workers aged under 18
- £3.50 for apprentices under 19 or 19 or over who are in the first year of apprenticeship.
The new pay rate will only affect workers’ pay from the first full pay reference period after that date. Similarly, if an employee has a birthday which means that they fall into a higher age category, the higher rate of pay only applies from the start of the pay reference period after their birthday.
All workers (including agency workers and casual workers) must receive at least the NMW. Self-employed people, volunteers, company directors and family members (or workers who live in the employer’s family home and undertake domestic tasks) are exempt.
Time spent travelling between a worker’s home and place of work will not usually count as time for which they are entitled to the NMW, however, time spent travelling between work assignments usually will.
The NMW should not be confused with the Living Wage. The latter is voluntary; it is set by the Living Wage Foundation, based on the cost of living in the UK.
New National Minimum Wage Rates
Age Current Rate New Rate from 1 October 2016
Age 25 + £7.20 £7.20
Age 21 + £6.70 £6.95
Age 18 – 20 £5.30 £5.55
Age 16 – 17 £3.87 £4.00
Apprentice Rate £3.30 £3.40
Voluntary overtime should be Included in calculation of statutory holiday pay
The recent case in the Employment Tribunal of Brettle v Dudley Metropolitan Borough Council held that that voluntary overtime should be included in the calculation of statutory holiday pay.
Previous cases have decided that in certain circumstances compulsory overtime ought to be included in holiday calculation but this recent case considered the specific question of voluntary overtime.
As the case was only heard at the Employment Tribunal level it is non-binding but does assist in predicting how higher courts might rule on this question in the future.
The employment tribunal endorsed legally non-binding comments made in the earlier Bear Scotland case that, in the absence of agreement to the contrary, the four weeks’ holiday under the Working Time Regulations 1998 should be deemed to have been taken before the additional 1.6 weeks imposed by UK law is taken.
Banning Muslims’ headscarves at work may not be discriminatory
Following a recent case, the European Court of Justice (ECJ) has ruled that it is sometimes acceptable for employers to refuse to allow female Muslims to wear headscarves in the workplace. This is on the important condition that the employers implement a company-wide policy of banning all religious and political symbols, including crucifix necklaces, turbans and clothing which states allegiance to a political party rather than singling out any one belief. The employer would also have to justify why it believed that allowing such expression of opinion would negatively affect its business.
In the case of Achbita and Another v G4S Secure Solutions NV, Ms Achbita, a Muslim in Belgium, decided after three years’ employment as a secretary that she wanted to wear a headscarf at work, as well as outside of work. Her employer refused to allow it, she wore it anyway and was dismissed. The following day, the Company updated its dress code to ban any signs of political, philosophical or religious belief. An advocate general of the ECJ stated, “While an employee cannot ‘leave’ his sex, skin colour, ethnicity, sexual orientation, age or disability ‘at the door’ upon entering his employer’s premises, he may be expected to moderate the exercise of his religion in the workplace.” This opinion is not binding and final judgement in this case is expected later in 2016.
We are also awaiting the judgement of a similar case: Bougnaoui and Another v Micropole Univers. In this case, a French Muslim engineer insisted on wearing her headscarf during client visits, despite her employer’s insistence that she removed it after clients complained.
Employers are still advised to proceed with caution and to bear in mind the distinction between a religious belief (which is protected by law) and conduct (which may sometimes be modified to suit the needs of the business). It is also interesting to note that those employees without a religion or political affiliation could be subject to discrimination for their lack of beliefs.
Travelling time is working time
Following the case of Federación de Servicios Privados del sindicato Comisiones Obreras v Tyco Integrated Security SL, Tyco Integrated Fire & Security Corporation Servicios SA Case C 266/14 ECJ, time spent by mobile workers travelling from their home to their first appointment and from their last appointment to their home now counts as travelling time. Time spent travelling between appointments also counts as working time but this was previously the case.
This means that travelling time counts as part of workers’ daily and weekly working hours and has implications for rest breaks. This ruling is about working hours, rather than pay, and does not automatically entitle workers to extra pay.
This decision, which applies from September 2015, has several implications for employers of mobile or peripatetic workers (those who have no fixed place of work); for example, engineers, delivery drivers and carers.
- Employers must now count driving time as working time when they establish whether an employee is taking enough rest breaks.
- With additional hours being added to the working week, it may mean that employees who have not previously opted out of the 48 hour working week now need to do so.
- Employees who are earning the national minimum wage (or only a little more), may now not be earning the national minimum wage on average once the extra hours are taken into consideration as working time. Therefore in certain situations, employers may have to give a pay rise.
- Depending on the wording of contracts, employees may argue that they should be paid their usual hourly rate for travel time or that overtime rates are triggered sooner due to them working extra hours when travelling.
Employers may be able to minimise some of these implications by ensuring that the first and last appointments of the day are near the employees’ homes or office base.
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