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National Minimum Wage (NMW) - A Decent Days Pay for a Decent Days Work?

It should be, but is it? Since 1st April 1999 there has been a legally binding minimum rate of pay in Britain, £3.60 an hour for adults, boosting pay packets by up to a third – could we really exist on that then - how times have changed. That wouldn't even buy you a pint now! During 1909 and 1993, Wages Councils would set minimum rates of pay in a number of different low paying industries. These were set up by Winston Churchill to protect workers’ pay in what he called the “sweated” trades. Before then, unscrupulous employers were notorious for paying as little as possible to desperate people, but still wanting to get the most out of them. They didn't have income support benefits then. It was no work, no money – no money, the workhouse or debtors jail!

Currently the hourly rate for adults is £6.19 which is due to go up on 1st October 2013 to £6.31 an hour. Not much of an increase in 14 years, but a yearly increase all the same in line with inflation.

And there are still unscrupulous employers paying a pittance but still expecting the best from their employees. Some of them even expect them to pay for their own uniforms. If you expect your employees to pay for their uniform out of their NMW then this needs to be taken into account. The NMW should be left once the uniform payment has been deducted – not before!

During the 2012-13 tax year 1,693 employers were investigated for breaching NMW rules and as a result 708 businesses faced penalty charges of up to £5,000. Totaling a bill of approximately £4m, 26,519 employees received an average of £300 in back pay because they had been paid below the legal minimum rate. Recent proposals are saying that these types of employers should now be named and shamed.

Most employers would want to pay their employees a decent day's pay for a decent day's work. You could consider an alternative to NMW - the “Living Wage”, as a guideline; it is not enforceable like the NMW. Boris Johnson, Mayor of London, has said that, “Paying the London Living Wage is not only morally right, but makes good business sense too.” It would definitely appeal to a better calibre of candidate when recruiting and help staff retention.

The Living Wage currently stands at £8.55 for London and £7.45 for the rest of the UK.

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