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Managing employees’ pay can be tough at the best of times, but when constantly changing rules are thrown into the mix, the challenge is inevitably heightened.
The National Living Wage was introduced in 2016, with the aim of ensuring that all workers over the age of 25 earn enough to fulfil a normal standard of living. So, the National Living Wage only applies to workers 25 or above, for workers below 25, the National Minimum Wage applies.
Failure to keep up with National Living Wage changes comes with a far from friendly penalty. How much, we hear you wonder? Well, you could be faced with a fine of 200% of the amount owed or a maximum penalty of £20,000 per employee – both certainly worth steering clear of.
And that’s just the financial impact. From time spent managing grievances, dealing with claims, liaising with the HMRC and appearing at an employment tribunal, the repercussions soon add up.
When it comes to running a business, keeping up with ever-changing legislation is just one of many elements you need to keep on top of, and we really do get how tough that can be. With us by your side though, it needn’t be a worry or a headache.
We’ll support you every step of the way by explaining complex legislation in a language you understand. We’ll arm you with the pragmatic advice you need to minimise any ill-effects on your business. We’ll keep you in the loop with future changes. And we’ll be by your side when the unwanted, but inevitable, curveballs strike.
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As of 1 April 2018, the National Living Wage is £7.83 an hour – a 4.4% increase on the previous rate (£7.50). When a new rate comes into force, you must apply it to the first pay period on or after the enforcement date.
So, for example, if an employee is paid on the 20th of the month, every month, they’d receive the previous National Living Wage rate up until April 20th, and the new rate thereafter.
If an employee’s paid more than the National Living Wage, you’re under no obligation to increase their pay in-line with the rate changes.
The National Living Wage applies to all workers over the age of 25, unless they’re:
Apprentices who’re under 19-years-old, or are 19 or above and in their first year of an apprenticeship programme, are entitled to the apprentice rate.
However, apprentices will be legally entitled to the National Living Wage if they’re:
Here at Citation, we’re the true HR & Employment Law experts. Whether it’s keeping you up-to-date with legislative changes, updating your documents, walking you through grievances or helping you deal with complaints, we’re here for you.
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