Rights to pay
Rights to pay
All workers are entitled to be paid for the work they have done. They are also entitled to be paid if they are ready and willing to work but their employer has not provided them with any work to do.
Workers are also entitled to be paid if they cannot work because they are off sick or on holiday, or away from work for a particular reason such as maternity leave, time off to deal with an emergency at home such as a childminder being ill, doing jury service and so on. In most of these situations, the worker will be entitled to their usual wage whilst off work. There are some exceptions to this rule, such as:-
a woman on maternity is entitled to a certain amount of paid maternity leave but the law sets out the rate at which this must be paid and it may not be as much as her usual wage
an employee on sick pay where their contract may give them less pay than their normal pay. By law, most employees are entitled to the legal minimum statutory sick pay. Their contract may give them more pay than this.
For a complete list of situations where an employee is entitled to be paid for time off work, and which time off work they are entitled to be paid for, see Basic rights at work . For more information about maternity pay and maternity leave, see Maternity rights at work . For more information about statutory sick pay, see Benefits for sickness and disability .
How much pay
Nearly all workers are entitled to the national minimum wage (see under heading National minimum wage (NMW) for more details). The worker may be entitled to more than this under their contract.
Any amount of wages on top of the national minimum given by law, or the amount of wages for workers who are not covered by the national minimum wage, depends on the worker’s individual contract of employment.
Employers must not discriminate in the amount that they pay their workers, for example, by paying black workers less than white workers who are doing the same job, or by paying women less than men when they are doing work of equal value. This is known as ‘equal pay’.
If you think you have been discriminated against in your pay, you should speak to an experienced adviser, for example, at a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by email, click on nearest CAB .
How should an employee be paid
There is no legal right to have wages paid in any particular way, for example, for an employee to have their wages paid direct into their bank account.
The way that an employee's wages are paid will depend solely on what their contract of employment says about how their wages should be paid. If they do not have a written contract, they still have a contract of employment, but it will be a verbal contract. In cases where there is a verbal contract rather than a written contract, the way wages should be paid should have been agreed between the employer and employee, or if not, will depend on how the employer usually pays the wages of the employees in that workplace.
What the contract should say about when wages are paid - written statement of terms and conditions of employment
All employees who have worked for their employer for at least two months are entitled by law to a ‘written statement of their terms and conditions of employment’. This written statement should include, amongst other information, details of how frequently wages should be paid, such as weekly or monthly.
The employee's contract should give the following details about their wages:-
when wages are paid, for example, at the end of the week, at the end of the month
whether wages are paid in advance or arrears. With monthly pay, it is common to be paid partly in advance and partly in arrears. With weekly pay, it is usual to be paid in arrears, that is, wages are paid after the work has been done
if wages are paid a week in hand. Sometimes if an employee is paid weekly, they have to work for two weeks before they receive any pay. This means that they are always, effectively, being paid a week in arrears and are owed a week’s pay throughout their employment. This week in hand payment will be made when the employee leaves the job.
If you are not sure about whether your contract gives you the above information about your wages, you should speak to an experienced adviser, for example, at a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by email, click on nearest CAB .
For more information about who is entitled to a written statement of terms and conditions of employment and what it should contain, see Employee’s right to written details about the employment contract in Employment status and contracts of employment .
Right to a payslip
All employees are entitled to an individual written payslip, at or before the time they are paid. The payslip must show:-
gross pay, that is, pay before any tax or national insurance has been taken off
take-home pay, after deductions such as tax, national insurance, pension and union dues. Deductions which change from week to week, for example, tax and national insurance, must be listed each time, with the amount of the deduction and what the deduction is for. Deductions which do not change, for example, union dues, only have to be shown once a year.
An employer is only entitled to make certain deductions from an employee's pay (see under heading Is the employer entitled to make deductions from an employee’s pay ).
National minimum wage (NMW)
Since April 1999 most workers in the UK aged 18 or over are legally entitled to a national minimum hourly wage, regardless of where they work, the size of the firm or the worker’s occupation. This includes casual labourers, agency workers, homeworkers, workers on short-term contracts and workers employed by subcontractors.
There are some workers who are not covered by the national minimum wage. These are:-
workers aged under 18
some apprentices. Apprentices aged between 19 and 25 do not qualify for the national minimum wage for the first year of their apprenticeship. If, after the first year of the apprenticeship, the apprentice is aged under 22, then they will qualify for the reduced rate of NMW for young workers, see below. If they are aged 22 or over after the first year of apprenticeship, they will be entitled to the full rate of NMW (unless they become a trainee, see below). Once they reach the age of 26 they will qualify for the full rate of minimum wage, whether they are in the first year of apprenticeship or not
some people living and working within a family such as nannies, and au pairs. Such a worker will not be entitled to the NMW if they live in the family home where they work and they share meals with the family and they do not have to pay towards their accommodation costs or meals
genuinely self-employed people
For information on whether a person is genuinely self-employed, see Are you an employee or self-employed in Employment status and contracts of employment .
members of the armed forces (but civilians working for the reserve
forces or the ministry of defence are covered)
share fisherman
prisoners
voluntary workers
some trainees on government schemes
For details of which trainees are not entitled to the NMW, you need to contact the NMW helpline or an experienced adviser. See below for details of the NMW helpline.
workers who are homeless or living in a hostel, who are entitled to income support/income based jobseeker’s allowance and who are taking part in a scheme run by a charity which provides them with work
residential members of religious communities.
How much is the NMW
For most workers aged 22 and over, the standard hourly rate of the NMW is listed below. Some workers are not entitled to the NMW at all (see under National minimum wage (NMW) ). Some workers are only entitled to be paid at a lower rate, because they are aged between 18 and 21 or because they are a trainee, see below. There are special rates of pay for agricultural workers (see under Wages for agricultural workers ).
Type of NMW
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Hourly rate of NMW: From 1.10.01
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Hourly rate of NMW: From 1.10.02
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Standard rate of NMW for workers aged 22 and over
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£4.10
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£4.20
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Workers aged between 18 - 21 - reduced rate NMW (see below)
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£3.50
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£3.60
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Workers aged 22 and over on the Trainee rate of NMW (see below)
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£3.50
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£3.60
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Reduced rate of NMW for young workers
If a worker is aged between 18 and 21 they are entitled to a reduced rate of NMW, see above. When they become 22, they are entitled to the standard rate of NMW, unless they are a trainee. There are special rules for apprentices - see above.
Trainee rate of NMW
A worker is entitled to the trainee rate of NMW if:-
they are aged 22 or over; and
they have been working for their employer for less than six months; and
they are receiving recognised (‘accredited’) training from their employer.
If you are receiving training and you want to find out whether the training is accredited, you should contact the NMW helpline, see below, or speak to an experienced adviser, for example, a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by email, click on nearest CAB .
Which types of pay and which hours of work count towards the NMW
The rules about which elements of a worker's pay, and which hours of working time, count towards calculating the NMW are very complicated.
You should contact the NMW helpline to check whether you are entitled to the NMW or should go to an experienced adviser, for example, a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by email, click on nearest CAB .
National minimum wage helpline
If a worker wants to find out if they are eligible to claim the NMW they can contact the National Minimum Wage Helpline on tel: 0845 600 0678 (local rates apply), or the Northern Ireland Helpline on tel: 0845 650 0207. They can also use the Tailored Interactive Guidance on Employment Rights (TIGER) website at www.tiger.gov.uk .
If you think you are entitled to the NMW but your employer is not paying it to you
If you think you are entitled to the national minimum wage and are not receiving it you should contact the NMW helpline (see above) or seek the help of an experienced adviser, for example, at a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by email, click on nearest CAB .
Wages for agricultural workers
Agricultural workers are entitled to a set minimum hourly pay depending on how old they are and the kind of work they do. They have a set rate for standard pay and a set rate for overtime pay.
If someone thinks they are an agricultural worker and therefore entitled to a particular level of pay, they should contact the Agricultural Wages Helpline for more information on:-
0845 000 0134 (calls charged at local rate)
Is an employer entitled to make deductions from an employee’s pay
By law, an employer is only entitled to make certain deductions from an employee’s pay. If the employer does not pay the employee at all, this counts as a 100% deduction. There are rules about what counts as pay for the purposes of when the employer can make deductions, see below.
In most cases, an employer can only lawfully make a deduction from an employee’s pay if the deduction is:-
required to be made by law. For example, employers are required to deduct tax and national insurance from their employee’s pay by law; or
allowed for by the employee’s contract. This means that there must be a specific clause in the contract which allows for that particular deduction to be made. The deduction can then only be made lawfully if the employee is given a written copy of that term in the contract before any deduction is made under it. This would cover deductions such as union dues or payments to a pension scheme; or
the deduction has been agreed to in writing by the employee before it is deducted.
There are particular additional rules for shop-workers which make it unlawful for an employer to deduct more than 10% from the gross wages of a shop-worker, if the deduction is for stock shortages or cash shortages.
There are particular deductions which an employer can make which do not have to fit into the categories listed above. These deductions are:-
a deduction because the worker has been genuinely overpaid
a deduction made because the employee took part in industrial action
a deduction made by an employer under a court order or an order from an employment tribunal, such as an attachment of earnings order (in Scotland, an earnings arrestment)
If you have had a deduction made from your pay which you do not agree with you should seek advice from an experienced adviser, for example, a Citizens Advice Bureau.To search for details of your nearest CAB, including those that can give advice by email, click on nearest CAB .
What counts as pay
When considering whether an employer can make a deduction from an employee's wages, the following all count as wages:-
normal pay including fees, bonuses and commission
holiday pay
payments ordered by an employment tribunal, such as payment of wages between an employee being dismissed and being given their job back
payments which have to be made by law instead of wages, such as guarantee payments when the employee takes time off to do union work or look for a job if they are to be made redundant
statutory sick pay
statutory maternity pay.
Tips and service charges
Tips in cash which are voluntarily given by a customer to a worker, such as a waiter, count as a gift from the customer to the worker. They therefore do not form part of the worker’s pay. Even if the cash tips are pooled by all the workers and shared out amongst them, they still remain gifts to the workers and so are not part of their pay.
If a service charge is compulsory, that is, it is added to all bills automatically, it is the property of the employer. The employer can share it out between the workers as the employer wishes, and if a worker is paid part of this compulsory service charge, it will form part of the worker’s wages.
If a tip is paid by a customer voluntarily adding an extra amount to a credit card or cheque payment, the tip is the property of the employer. The employer can share it out between the workers as the employer wishes and if a worker is paid part of this voluntary additional payment, it will form part of the worker's wages.