Understanding National Minimum Wage law

Introduction

The National Minimum Wage is a legal right which covers almost all workers in the UK. It became law on 1 April 1999 to prevent unduly low pay and also to help create a level playing field for employers.

The number of hours for which you have to pay your workers the minimum wage is calculated differently according to the types of work they do. These are based on time, salaried-hours, output and unmeasured work.

This guide provides the background to the minimum wage and directs you to further information and advice.

On 1 October 2005, regulations will be changing in this area. For more information, see our regulation update on The National Minimum Wage.

Subjects covered in this guide

• Introduction
• National Minimum Wage rates
• Who is entitled and who is exempt?
• What is included and not included?
• The four types of work
• Calculating hours worked and paid leave
• Records and reporting - best practice
• Enforcement and penalties