National Minimum Wage – Pitch Your Allowances Carefully!

Money

The National Minimum Wage (NMW) was first introduced in 1999 at a rate of £3.60 per hour for those over 21. It is currently £6.70 per hour and will be reviewed in October 2016. The Government introduced the National Living Wage (NLW) on 01 April 2016 which is set at £7.20 per hour for those over 25. This will be reviewed next April – further details can be found here.

Failure to meet these minimum requirements may lead to fines and even criminal
essential that employers keep records (we suggest 6 years’ worth) to prove that NMW and NLW has been paid throughout. If you fear that you have not been meeting the required standard, act immediately. Here is a handy calculator to work out whether you are paying correctly.

Minimum rates are applicable to:

  • Employees;
  • Workers and those employed by agencies;
  • Labourers and casual workers;
  • Agricultural workers;
  • Family members who work for you;
  • Executive members of staff; and
  • Apprentices (although different rates apply below 25).

Pay or wages must be in the form of gross cash money before income tax and national insurance deductions. One exception is for Accommodation Offset, that is actual living accommodation and not pitch fees. The current Weekly Accommodation Offset Rate is £37.45. No other kind of employment benefit such as food, transport, childcare vouchers or utilities counts towards minimum wages.

This may come as a shock to some park owners who regularly pay wardens and grounds keepers in pitch fees, transport and utilities in return for casual grass cutting and general site maintenance, for example. Whilst all parties may be content with this arrangement now, there remains a significant risk of repercussions if the parties ever change their minds or a park is audited.

Working time should generally be averaged over a month long reference period. There are specific rules for young workers, night workers and those who carry out monotonous work. Workers are also limited to a 48 hour week unless they sign an ‘opt out’ agreement. Workers are entitled to a minimum 11 hours’ uninterrupted rest per day and a 20 minute (not an hour) rest break when working for more than 6 hours’ per day (unless their contract of employment states otherwise). Employees must have a contract of employment that is compliant with s.1 Employment Rights Act 1996 and if working full time, they should benefit from 5.6 weeks’ paid holiday per year receiving minimum wage throughout.

For some parks this may be old news. For others it may come as a stark reminder.

David Ward

David Ward

David Ward
Solicitor
Holiday and Home Parks Team
DWard@LawBlacks.com
0113 227 9262

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