As an employer you are responsible for ensuring your employees are paid at least the National Minimum Wage.  The rates of pay have increased from 6 April 2024 and are shown below.

  • Age 21 and over - £11.44 per hour
  • Age 18-20 - £8.60 per hour
  • Age under 18 - £6.40 per hour
  • Apprentices under 19 or over 19 and in the first year of apprenticeship - £6.40 per hour

Last year the rate for 21 and 22 year olds was £10.18 per hour but that age group is now incorporated into the top rate.

Employers must ensure that any deductions from pay - excluding statutory deductions such as tax, NI and pension - do not take the employee below the minimum wage.  Salary sacrifice or repayments for tools, clothing, training, etc must not leave the employee with a gross pay of less than the minimum wage for the hours they work.

HMRC are currently in consultation about employers providing the hours their employees work each pay period and this may well be taken forward at some stage in 2024-25.  At the moment hours worked are reported in bandings but once actual hours worked are provided HMRC will be able to identify employees who are not being paid the minimum wage for the hours they work.

Employees who are paid an hourly rate for actual hours worked will generally be paid the correct rate - as long as no deductions are made.  However salaried staff are paid a fixed rate for their contracted hours and often aren't paid for the extra bit of time they work each day, week or month.  Employers are expected (by HMRC) to keep a record of hours worked by each employee and reimburse them before the end of their financial year or the tax year if they have worked more hours than contracted over the year.  This could be a substantial payment but if not made it could result in the employee having been paid less than the minimum wage over the course of a year.  This is what HMRC will look for when they carry out a minimum wage investigation.

If an employee feels they are not being paid the minimum wage they can make a complaint to HMRC which could trigger a payroll minimum wage investigation.  HMRC name and shame employers who haven't paid the minimum wage a couple of times a year and this could happen to you by not being aware of what can and can't be deducted from an employee's wage.

If you want to ensure your payroll is being done correctly contact us.  We work with a large number of employers with varying numbers of employees and we have advised all those who pay close to the minimum wage the minimum they have to increase pay to for the 2024-25 tax year.  We also ensure all deductions from pay are allowable and do not take employees below the minimum wage.

Contact us now if we can help manage your payroll.