The National Minimum Wage (NMW)
It is illegal to pay for an employer to pay an individual in their employment a wage which is below the national minimum wage.
Employees and the national minimum wage
Employees must be paid in an hourly rate according to the national minimum wage. It is not legal to pay an individual who is an employee according to a different variable such as the number of rooms cleaned if this rate takes them below the national minimum wage.
Individuals who are employed on a freelance basis such as freelance writers are able to be paid according to other variables such as how many articles they write but if an individual is deemed to be an employee they have certain rights which are provided to them under the Employment Rights Act 1996. One of these rights is to be paid according to the national minimum wage.
Has this situation occurred recently?
In a recent case a cleaning company which operated the cleaning contract for a high profile UK hotel has been found in breach of the regulations concerning the national minimum wage.
What happened in this case?
In this case many of the staff were working a total of 40 hours per week cleaning the rooms in the hotel. However, some of them were being paid half of what they should have earned according to the national minimum wage.
The employees had signed agreements with the employer stating that they would be paid a minimum hourly rate. However, when they received their wage slips they found that they had instead been paid an amount according to the number of rooms which they had cleaned. Reportedly this is a practice not that uncommon in the hotel industry.
In some cases the cleaners were simply given twenty minutes to clean the rooms but in many cases simply were not able to do this meaning they were not paid for that room despite working on it for a certain period of time.
What was the outcome of this case?
Following an investigation by the UK media many of the hotel attendants took their claims to an employment tribunal claiming that they had been underpaid and that the correct records relating to their payment had not been kept. The keeping of incorrect records is also an offence under minimum wage legislation.
Following the decision of the employment tribunal the employer was ordered to make payments to the employees in the form of the pay which they were owed and damages.
Why does this practice often occur in this and similar industries?
Individuals employed in this and similar other industries in many cases are foreign workers. These workers, despite being legally entitled to work in England and Wales are not aware of the employment rights guaranteed to them by law. Often employers will exploit these employees in this manner for their own gain.
It is therefore imperative that legal advice is sought and claims brought if individuals find themselves in this position and are being exploited by their employers.