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Minimum wage records
The National Minimum Wage Regulations 2015 require employers to maintain records which show the worker is being paid at least NMW or NLW. Records can be kept on paper or electronically but must be able to produce an individual document which relates to each pay reference period.
As a minimum, records must be kept in relation to the pay made to workers and the amount of hours worked. Depending on the circumstances, additional information may need to be recorded, such as:
- additional payments made to workers e.g. commission and performance rewards
- deductions made from pay and
- copies of agreements relating to pay e.g. training agreements.
Usually, employers will be able to use existing documentation to show workers are being paid the correct minimum, such as itemised pay statements or PAYE records. From 6 April 2019, workers became entitled to itemised pay statements as well as employees.
Records must be kept for a minimum period of six years from the end of the pay reference period following the pay reference period the records relate to. Civil claims relating to NMW failures can be brought by individuals up to six years after the breach occurred, or five years in Scotland.
The Taylor Review and minimum wage
During 2017, Matthew Taylor published a review which, amongst other things, suggested that a higher minimum wage rate should be introduced for zero hours workers. The government stated they would respond to the review by the end of 2017, although this was delayed to the beginning of 2018. The government has now released their response to the Taylor report and have announced they will ask the Low Pay Commission to assess the impact of introducing a higher minimum wage rate for working hours that are not guaranteed under an individual's contracts.
A focus on the use of unpaid internships, and the exploitation of these, was also announced. The government has announced an initiative to tackle the illegal use of unpaid internships and the HMRC will be tasked with carrying out enforcement action in this area.