The Minimum Wage – how does it affect you?

I thought I should add a little more on this topic mainly about apprenticeships and also the penalties that employers can hit with by HMRC should the Employment Legislation Act 2008 not be complied with. There is no National Minimum Wage for apprentices aged 19 years old or above for the first 12 months of their apprenticeship. After 12 months the minimum wage should apply according to their age. The National Minimum Wage does not apply to apprentices under the age of 19 years old; instead a £95 weekly developmental rate is implemented. Under the Employment Act 2008 employers face a penalty if HM Revenue & Customs discover they have failed to pay the National Minimum Wage. The penalty is set at 50 per cent of the total underpayment (for periods starting on or after 6 April 2009). The minimum penalty is £100 and can rise to a maximum penalty of £5,000. Employers who comply fully within 14 days of service of a 'notice of underpayment' will receive a discount of 50 per cent on the penalty. In addition, workers will be entitled to have arrears of wages repaid at current rates.

Minimum Wage Increases by 7p

Today the national minimum wage is increased by 7p to £5.80 (for those ages 22 or over), it is also the day that the government have rules that tips or service charges to top up employees salaries.  This has received a mixed welcome from the industry, the British Hospitality Association (BHA) believe that the changes will actually cost jobs by incurring costs for employers.  The government have also conceded that it will cost an additional 60 million to ensure that all changes are implemented and met effectively, particularly as NI contributions will increase.

There are a number of different views on this topic with many agreeing that a tip is left for good service and not to help the business top up the wages to the legal requirement and I would have to agree. There have been suggestions that this could lead up to 5000 job losses by some leading organisations while other have hailed it as a landmark breakthrough. 5000 job losses? Well that will have quite likely have effect on tips, under staffed, slow service and harassed waiting staff (albeit through no fault of their own) is not what most tip for. If anything the cost of a meal may increase slightly to absorb costs (that really should not have been there anyway) but if value for money still remains, surely that is always worth paying for!