Employment National minimum wage and pay The National MinimumWage Act 1998 prescribes three categories of worker with differing minimum hourly rates of pay. The current rates are: • Workers aged 21 and over: GBP 6.70 (about USD 10) per hour • Workers aged 18-20: GBP 5.30 (about USD 8) per hour • Workers aged 16 and 17: GBP 3.87 (about USD 6) per hour The Act applies to all workers within the UK, regardless of whether they are migrant workers and whether their employer is based in the UK. These rates are updated annually with effect from 1 October each year. From April 2016, the National Living Wage will apply to workers aged 25 and over. The rate will be GBP 7.20. The policy aspiration is for the rate to reach 60% of the median wage (GBP 9.00) by 2020. There is also a voluntary living wage set by the LivingWage Foundation (a campaigning organisation) – currently set at GBP 8.25 nationally and GBP 9.40 for London. Employers face pressure to adopt these rates, and to ensure that their supply chain does so. There is often a requirement to adopt this living wage when tendering for public sector projects. The construction sector has industry wide collective agreements (ie between employer’s organisations and unions). These deal with pay, hours and other core terms and conditions. As a minimum, these set expectations/market rates even where there is no legally enforceable obligation to pay new employees on those terms.
Working time regulations The Working Time Regulations 1998 stipulate that a worker’s weekly hours cannot exceed 48 hours on average within a prescribed time. Currently, a worker may opt out of this stipulated maximum by express agreement (which can be revoked). A worker is generally entitled to a rest period of not less than 11 consecutive hours in a 24 hour period and 24 hours in a seven day period. There have been a series of rulings which extend the impact of the Regulations – for example on the rate of holiday pay and, for peripatetic workers, to the effect that travelling time counts as working time. Termination and redundancy When terminating contracts of employment, employers must provide employees with at least the statutory minimum period of notice (the contract can specify a longer period), as follows: • One week, if the employee has been continuously employed for between one month and two years • One week for each complete year (up to a maximum of 12), if the employee has been continuously employed for two or more years An employer’s obligation in the event of redundancy depends on the type of contract that the worker is employed under, the length of service of the employee in question, and the availability or otherwise of alternative work. Employers should – certainly as regards those employees with Unfair Dismissal rights (broadly, two years’ service) – follow a fair redundancy procedure (including a requirement to consider alternative suitable employment).
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