National minimum wage

Posted: 16th September 2011

Earlier this year, the Low Pay Commission reported that there was continuing evidence of breaches of the National Minimum Wage (NMW) Regulations with regard to young people doing work experience. It recommended that the Government take steps to promote a better understanding of when a legitimate unpaid work experience opportunity becomes a work placement that should be paid at least the NMW and that stronger enforcement action should be taken when the rules are broken.

The Government has now issued guidance for employers on the payment of the NMW for interns and for those on work placements or carrying out work experience. Whether or not someone is a worker and is therefore entitled to be paid the NMW will depend on the particular arrangements in place. The guidance includes a new worker checklist and examples of case studies to help determine the person’s employment status.
Employers are reminded that new rates for the NMW come into force on 1 October 2011.
The revised rates are as follows:
  • The adult hourly rate of the NMW will increase from £5.93 to £6.08;
  • The development rate (which covers workers aged 18-20 years) will increase from £4.92 to £4.98; and
  • The rate for workers aged 16 and 17 will increase from £3.64 to £3.68.
The apprentice rate, for apprentices under 19 or those aged 19 or over and in the first year of their apprenticeship, will increase from £2.50 to £2.60 per hour.
From 1 October 2011, the accommodation offset will rise from £4.61 per day to £4.73.
Further guidance is available here.