Financial expert Martin Lewis has revealed a checklist of the eight ways people who are on the new higher minimum wage can be underpaid by bosses. From April the National Minimum Wage went up significantly - reflecting the rise in inflation but the Money Saving Expert founder revealed an estimated 500,000 people aren't getting what they should be.
The main figure for those aged over 23 went up from £9.50 to £10.42 per hour. The ‘adult rate’ for those 21-22 went from £9.18 to £10.18, development aged (18-20) from £6.83 to £7.49.
The Young workers rate (age 16-17) went from £4.81 to £5.28 and the Apprentice rate from £4.81 to £5.28. However speaking on Good Morning Britain, Mr Lewis revealed that many employers were still not paying the minimum wage properly, leaving some of the poorest people in the country underpaid.
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He said: “It’s important to understand this isn’t just for people who are paid hourly. This applies even if you are on a salary. For example, if you work 35 hours a week and you’re aged 23 then you should earn a minimum of £19,964 a year. Those are the rates, but people can still be underpaid. “
Mr Lewis said there were eight different ways the minimum wage was underpaid.
1. Uniforms
Mr Lewis explained: “So let’s take a look on that the first one in the biggest category. If, as part of your employment, you have to pay for your uniform or tools or safety clothing or appropriate clothing and the cost of those once it is taken off, your wage puts you less than the minimum wage. You are being underpaid, and they are not allowed to do that.”
2. All working time
Mr Lewis said: “You must be paid for all of your working time, including overtime training, travel time, not commuting, waiting time, opening up time. So let’s say you’re doing a security check and you’re not paid for that. At the start of your shift, you don’t get paid. You only get paid once your hours start. If you were to factor that those hours in and that was to take you below minimum wage, which it would for anyone who’s only at the bottom end of minimum wage, then you are being underpaid.”
3. Minimum wage should rise
He said: “The next thing to notice is your minimum wage should rise each April on the first full pay cycle, which means the first amount of pay that comes after the after the April. So if you started being paid second of April to second of May, then you would get the money for that, and your pay should go up when you turn 18, 21 23 because there are different rates, an important one.”
4. Accommodation costs
“Next, for anyone who gets accommodation as part of their job, they are allowed to reduce what you get below the minimum wage, but only by a maximum of £63.70 a week. And that includes any accommodation costs for gas, electricity, furniture and laundry that you get as part of your accommodation. “
5. Tips or overtime
Mr Lewis explained: “For those who get tips or overtime, it has to be on top of the minimum wage that does not count towards the minimum wage. Your basic standard minimum wage must be part of that. And if you have a higher overtime rate and they try and use that as a justification, why they can give you a lower standard rate, it doesn’t work. The standard rate you get should be at minimum wage next one."
6. Employers must top up commission to minimum wage
“If you’re on commission only, and you’re not getting the minimum wage, employers have to top it up. If you do not have set hours, they need to work it out via a fair estimate of how long it would take you to do the job getting towards the end the apprentice rate.“
7. Apprentice rate only for real apprentices
“You need to be a real apprentice, and that means you should have structured training as part of what you do. If not, you’re not an apprentice. You should be on the rate for your age, and you may be being underpaid if you’re not.”
8. Don’t assume company is too big to make a mistake
Mr Lewis warned: “And finally, don’t think all of these are for little firms trying to play fast and loose. In the past, we have had name and shames of John Lewis, Sheffield United Body Shop and many other big companies who have got it wrong. So don’t assume if you’re on minimum page working for a big firm that you’re being paid the right amount go through this checklist.”
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