Calculating National Minimum Wage

Descripción

3 steps to follo and information you need to complete each of these steps. Ge more information here: https://www.gov.uk/hmrc-internal-manuals/national-minimum-wage-manual
Jevgenija Zukova
Fichas por Jevgenija Zukova, actualizado hace más de 1 año
Jevgenija Zukova
Creado por Jevgenija Zukova hace más de 6 años
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Pregunta Respuesta
STEP 1. Calculate the worker's minimum wage pay for the PRP
What is pay reference period? It's the period (of time) over which earnings are to be measured. For example, if an employee is paid weekly, the pay period would be one week and if they are paid monthly, the pay period would be one month.
What is the minimum PRP? The minimum pay period is one week.
1.1. Pay counted during a pay reference period for the purposes of the minimum wage. What is minimum wage pay? The minimum wage pay allocated to a PRP is a summ of: 1) pay received during that period; 2) and pay earned in that period but not received until the next pay reference period
1.2. Allocate annual bonuses. Do annual bonuses count towards the minimum wage pay during a PRP? Annual bonuses almost always are counted towards the PRP it was paid in, which for many people is December. 1/12 of the annual bonus can be paid in the period before that (e.g. November).
1.3. Allocate pay based on timesheets. This part is only for the people who record the time they have worked during a pay reference period on timesheets.
When hours recorded on a timesheet can count towards NMW for the accoring PRP? Hours recorded on a timesheet can count towards NMW for the according PRP only if the hours were paid in according PRP or the next PRP.
If a worker submits their timesheet within four working days before the end of the pay reference period, the employer must pay that to the worker until the end of the next PRP, and if this is done – To which PRP do these hours belong? These hours are counted to the PRP in which these hours were made.
1.4. Exclude elements which don’t count as a pay. Which elements you don't count as minimum wage pay? - Loans - advances of wages - pension payments - lump sums on retirement - redundancy payments - rewards under staff suggestions schemes
What is incentive (pay-for-performance) pay? It's so-called because the prospect of financial compensation is supposed to be an incentive for an employee to remain motivated, work hard and strive for the best possible results.
When does incentive pay count towards minimum wage pay? It ionly counts if this pay relates solely to the performance of a worker and is made as part of an incentive, sales commission, merit or any performance-related pay scheme.
Do tips, gratitutes, service charges and cover charges count? Tips, gratuities, service charges and cover charges do not count towards minimum wage pay.
What are allowances? Amount paid to employees as part of their salary package, or to defray their out of pocket expenses incurred on behalf of the firm.
Do allowances count towards minimum wage pay? Allowances don't count towards minimum wage pay unless they have been consolidated into the worker's standard pay or they relate to the worker's performance.
What other payments should be excluded and don't count as pay? (2) - Payments made to reimburse a worker’s expenses don’t count towards NMW. - Benefits in kind do not count towards minimum wage pay.
What are premium eliments in calculating NMW? Overtime pay
How to calculate a premium pay? 1. Multiply the total number of hours worked ina PRP by a basic NMW rate. 2. Then subtract the resulting from the total pay actually received for the hours worked. 3. The reminder does not count cowards minimum wage pay.
STEP 2. Work out total working hours that count for minimum wage purposes during the pay reference period.
What types of work are there? - Time work, (where people are paid by the hours they have been contracted to work in a certain period) - Salaried hours work, - Output work and unmeasured work.
What if a worker does different types of work for a single or different employers? If a worker does different types of work for a single or different employers, the rules and calculation of hours apply differently for each type of work that the worker does.
For time and salaried job workers, what counts as their hours of work? When they are... - at the workplace working, - at work and required to be available for work (such as training) - required to be available for work either on standby or on-call at or near their workplace - kept at their place of work but cannot work because of machine breakdown (time workers only)
What time doesn't count as working time for time workers? - travelling between home and work – regardless of whether the worker has a fixed place of work, - away from work – including rest breaks, holidays, sick leave, maternity/paternity/adoption leave, industrial action.
Does holyday pay, sick leave or maternity leave pay to teh time worker count towards their minimum wage pay? When a time worker is absent from work neither the pay (for example, holiday pay, or pay for sick leave or maternity leave) nor the hours of absence count for minimum wage purposes.
What is output work? Work that is paid only according to the number of things that a worker makes or tasks they perform. 'Piece work' or 'commission work' may sometimes be output work for minimum wage purposes.
What counts as working hours for output workers? - time spent travelling on business, - if the worker works from home, time travelling from home to other work premises; However, if they are a homeworker it does include time spent travelling from home to the premises they report at, - fixed hours of work if it was stated in the contract with an employer.
When an output worker must be considered as time worker? When their working hours are fixed by the client. (Even if they are still paid according to how much they produce)
What counts as working hours for unmeasured work? - time spent travelling on business - hours specified in 'daily average' agreement or time actually worked - if the worker works from home, time travelling from home to other work premises
When is the NMW paid for the traveling? - required to travel in connection with their work, - travelling from one work assignment to another - except for rest breaks, - waiting to either collect goods, meet someone in connection with work or to start a job, - travelling from work to training venues.
STEP 3. Divide the worker's minimum wage pay (STEP 1.) by the hours worked (STEP 2.).
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