What is the National Minimum Wage?

The National Minimum Wage is the minimum amount which a worker, who qualifies for the National Minimum Wage, should be paid. The National Minimum Wage was created by the National Minimum Wage Act 1998. Since the Act was passed certain other Regulations have been made in relation to the National Minimum Wage.

Who is entitled to be paid the National Minimum Wage?

A person qualifies for the National Minimum Wage if he is an individual who is a worker, he is working, or ordinarily works, in the United Kingdom under his contract, and has ceased to be of compulsory school age. The person does not have to be an employee and the definition of a worker is very wide. Most workers will qualify for the National Minimum Wage.

Although the National Minimum Wage Act 1998 applies to most workers, the Act contains special provisions relating to certain types of workers. These are as follows:

  • agency workers;
  • home workers;
  • persons employed by the Crown;
  • members of the House of Lords staff;
  • members of the House of Commons staff;
  • mariners;
  • individuals who are not otherwise “workers”; and
  • persons in offshore employment.

Who is not entitled to be paid the National Minimum Wage?

The Minimum Wage Act 1998 specifically excludes the following workers:

  • share fishermen;
  • voluntary workers;
  • resident workers in religious and other communities;
  • prisoners;
  • members of the armed forces; and
  • persons detained in removal centres under the Immigration and Asylum Act 1999.
  • The Minimum Wage Act 1998 gives the Secretary of State the power to, by passing further regulations, exclude certain other classes of people from the entitlement to the National Minimum Wage. As at June 2010 the following persons are excluded under such regulations:
  • students doing work experience as part of a higher or further education course where the work experience doesn’t last longer than a year;
  • apprentices under the age of 19;
  • apprentices over the age of 19 who are in the first year of their apprenticeship;
  • persons taking part in certain government schemes (for example Entry to Employment, Programme Led Apprenticeships and Skillbuild);
  • homeless workers who are provided with shelter and other benefits;
  • persons taking part in certain government employment programmes which provide training or work experience to job seekers; and
  • persons taking part in certain European Community programmes (for example Youth in Action).

Unlock this article now!

 

For more information on:

  • Can an employer contract out of the National Minimum Wage Act?
  • How much is the National Minimum Wage?
  • How can it be determined whether the National Minimum Wage has been paid to a particular worker?
  • Does a worker who is entitled to be paid the National Minimum Wage have any other rights under the National Minimum Wage Act?
  • What can a worker who is entitled to be paid the National Minimum Wage but is paid a lower amount do?
  • What is the penalty for failing to pay the National Minimum Wage?