National Minimum Wage – Enforcement
The Government has just announced the new rates of pay for National Minimum Wage (NMW) that will take effect on 1st April 2023. The new rates of pay compared to those currently in place are:-
- Age 23 or over (NLW rate): £10.42 (up 9.7% from £9.50).
- Age 21 to 22: £10.18 (up 10.9% from £9.18).
- Age 18 to 20: £7.49 (up 9.7% from £6.83).
- Age 16 to 17: £5.28 (up 9.7% from £4.81).
- Apprentice rate: £5.28 (up 9.7% from £4.81).
What can you do as a worker or employee if you are not paid the correct rate?
Even if you have agreed to accept a reduced rate, lower than National Minimum Wage you still have a claim.
Any agreement by a worker/employee to be paid a lesser rate is void.
A number of claims could be available to you:-
- Unlawful deduction from wages
- Breach of contract
- Unfair dismissal
- Detriment
Strict time limits apply so seek our advice early.
Unlawful deduction for wages
This is a claim that you have not been paid the correct amount and therefore, the difference in your actual pay and the NMW amounts to an unlawful deduction. Such a claim must be brought within three months of the date you received the pay. However, if the pay you are receiving is lower than NMW on an ongoing basis then you will be able to claim at any time within three months of the last payment. Relatively recent changes to the law though mean you can only claim back for a maximum of two years.
We would assist you in calculating the arrears of pay and the period for which you could claim.
Unfair dismissal and Detriment
If you are dismissed because you have sought to ensure that you received the correct rate, or because your employer has been prosecuted for an offence for failing to pay NMW under The National Minimum Wage Act 1998 then this will be automatically unfair.
This means you do not need a specific length of service to be eligible to bring a claim for unfair dismissal
If you suffer any detriment as a result of:
- becoming or being eligible for NMW
- taking action to ensure you receive it;
- or your employer being prosecuted for an offence relating to NMW
then you can bring a detriment claim for compensation. The Employment Tribunal will award such compensation as it considers just and equitable in the circumstances.
If you are a worker and you are fired because you have asserted your rights regarding NMW then although normally workers cannot claim unfair dismissal (as this is only available for employees) you can advance an unfair dismissal or detriment claim in this situation.
In these cases it will be assumed that the worker qualified for the NMW unless then employer can prove otherwise.
The worker/employee bringing legal action is just one consequence for the employer of failing to adhere to the NMW and the National Minimum Wage Act 1998. There are criminal proceedings, civil enforcement and public naming of organisations.
Contact our employment law specialist, Jennifer Carpenter solicitor and managing partner if you need advice on the National Minimum Wage legislation as a worker, employee or employer.
