The National Minimum Wage is a key piece of legislation with which all small business owners should familiarise themselves. We’ve teamed up with LHS Solicitors’ elXtr team to bring you a customisable National Minimum Wage increase letter template so you can make sure you’re on the right side of the law.
National Minimum Wage increase letter template - free PDF or Word download
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National Minimum Wage increase letter template - free download
Tell your staff about changes with this handy template.
Why use an elXtr template?
Every small business has its own legal requirements, but most do not have the resource to hire in-house legal counsel. That’s where elXtr comes in. The service was started in order to provide legal documents to small businesses, and we’ve partnered with them to offer key pieces to help you navigate the law.
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- View our full range of elXtr legal templates
What is the National Minimum Wage?
The National Minimum Wage (NMW) is the minimum hourly rate to which workers are entitled. While it was introduced in an Act of Parliament in 1998, it only came into effect in April 2009.
The National Minimum Wage applies to every employer, regardless of their size, so even the smallest businesses need to abide by it. If employees think they are being paid below the NMW they can take their employer to a tribunal. It is a criminal offence to fail to pay the National Minimum Wage. If you are found to have been doing so, you can be taken to court and forced to pay arrears.
An independent body called the Low Pay Commission decides whether or not to increase the National Minimum Wage at regular intervals. You must follow any increases, for which you will need our National Minimum Wage increase letter template.
Who is eligible for the National Minimum Wage?
The National Minimum Wage applies to almost all workers in the UK. In order to qualify, they must be of at least school leaving age. Workers aged 25 or over are entitled to the National Living Wage, which is covered later.
Workers are entitled to the NMW even if they are not full-time. For example, they will still be eligible even if they are part-time, casual workers, agency workers, apprentices, or trainees. However, there is a separate apprentice rate for apprentices aged either under 19, or 19 or over but still in the first year of their apprenticeship.
There are some exceptions to National Minimum Wage eligibility. Most importantly, self-employed people are not entitled to it. This also extends to company directors, volunteers, those on further or higher education work placements for up to a year, workers on government employment programmes, and others.
At the time of writing, the National Minimum Wage is £6.95 for those aged 21 to 24, £5.55 for those aged 18 to 20, and £4.00 for those aged under 18. In April 2017 this will increase to £7.05 for those aged 21 to 24, £5.60 for those aged 18 to 20, and £4.05 for those aged under 18.
What about the Living Wage?
There is a separate, higher rate for some workers, known as the National Living Wage. This came into effect in 2016.
Workers are entitled to the National Living Wage if they are aged 25 or over. At the time of writing the current National Living Wage rate is £7.20, rising to £7.50 in April 2017.
What happens when the National Minimum Wage is increased?
The National Minimum Wage and the National Living Wage are revised annually. In the event of increases, you should communicate the new rate to your employees. Our customisable National Minimum Wage increase letter template allows you to do so quickly and easily, with a simple document. It includes details of the old and revised rates, along with details of the employee’s age to demonstrate why they are receiving the increase. You can download the National Minimum Wage increase letter below.
National Minimum Wage increase letter template - free Word document for download
If you would like to make changes and don’t have Adobe Acrobat, you can also download our National Minimum Wage increase letter template in Word format.
This document has been produced by LHS so we can’t take responsibility for its contents. We’d recommend you take professional advice before making any important decisions based on its contents.