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The adult rate of the National Minimum
Wage (NMW) will rise to £5.80 (£5.73) an
hour in October 2009. This is payable to
those age 22 and over.
The hourly youth development rate will
increase to £4.83 (£4.77) and for 16 and
17 year olds to £3.57 (£3.53) an hour.
Penalties for non compliance
HMRC are able to charge penalties to
those employers found to be in breach of
the NMW rules.
From 6 April 2009, automatic penalties
are levied on employers where HMRC
officers find NMW arrears. The penalties
range from £100 to £5,000 with 50% prompt
payment discounts for employers who settle
within 14 days of notification.
The penalty is payable in addition to
arrears owed to the workers.
The penalty notice will detail the
amounts due to workers (calculated
according to the formula shown below) and
any penalty due on those arrears. The
penalty is calculated as half the total
underpayment. The underpayments are
uprated to take into account the length of
time the arrears have been outstanding.
For each payment period the formula is:
Original underpayment x Current
NMW rate = Arrears
Original NMW rate
In serious cases of non compliance the
employer may be tried in a Crown Court and
in those cases the fines are unlimited.
If you have any queries on the NMW
please do get in touch.
Internet links:
HMRC guidance on penalties
NMW news release |
