EMPLOYMENT LAW

Employment – Pay & Wages

Let’s be honest, few of us would work for free!  Pay & wages is an important part of your employment contract with your employer, and various employment law issues can arise out of that.  If you need employment law advice from one of our solicitors please reach out.

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Employment Blogs

Pay & Wages FAQs

All workers and employees are entitled to at least National Minimum Wage hourly rates for their age. Facts and figures 22/23 – the rates are changed every April so make sure you’re looking at the correct year’s information.

You should be paid at least at the appropriate National Minimum Wage hourly rate for each hour of “working time”.

Working time is any period during which the worker is (a) working, (b) carrying out their duties and (c) at their employer’s disposal. It’s also any period during which the worker is receiving “relevant training” (e.g. on the job training), or which the parties agree will count as working time.

You’re entitled to be paid your salary or wages right up to the termination date, regardless of why you are leaving your job, plus employees or “workers” are also entitled to be paid in lieu of accrued but untaken holiday. This is usually calculated on the number of complete calendar months you’ve worked in the current holiday year.

If being dismissed, employees are entitled to statutory minimum notice, or the notice period in their contract if that’s longer, unless they are being summarily dismissed e.g. for committing gross misconduct. Workers will be entitled to the notice period in their contact. Sometimes employees or workers will work for their notice period, or they may be “paid in lieu”, which means employment ends and instead of working for the (rest of the) notice period, the employee is paid what they would have earned during that period as a payment in lieu of notice or PILON payment.

Statutory minimum notice is the minimum period of notice that employees are entitled to be given if the employer terminates their employment.

There are cases where you aren’t entitled to notice, such as if you are summarily (immediately) dismissed for gross misconduct. Assuming that doesn’t apply, the basic entitlement is to one week’s notice after one month’s service and up to two years’ service, then an additional week’s notice for every complete year of employment up to a maximum of 12 weeks’ notice after 12 years’ employment.

So, if you’ve been employed for 7 years, you’re entitled to 7 weeks’ notice. If your contract says you’re entitled to more than your statutory minimum notice (say, if your contract says 3 months’ notice) then that’s what you’re entitled to regardless of how long you’ve worked for.

As explained above, sometimes the individual will keep working during their notice period and the termination date will be the end of notice, but sometimes they will be paid in lieu of notice and the termination date will be the start of the notice period. Or it could be part working and part paid in lieu. Either way, notice pay is always taxable whether you work your notice period or are paid in lieu.

Yes, if your contract says your employer can deduct any money you owe them from your pay, during or at the end of employment. Note that this doesn’t refer to deductions for PAYE/tax and National Insurance Contributions, or pension contributions, private medical etc, which must be deducted at source before your pay is paid to you.

It’s best for an employer to reconfirm at the time what they intend to deduct and why. For instance, if you’re leaving before you’ve paid off a season ticket loan, or training fees, then you can expect the outstanding amount to be deducted from your final pay. Check your contract and seek advice if you aren’t sure that your employer is entitled to make the deductions they propose.

If you’re not fit to work, and are an employee, you’ll usually be entitled to Statutory Sick Pay (SSP). The current rates generally change every April.

SSP can be paid for up to 28 weeks’ absence. The first 3 days’ sickness are “waiting days” and unpaid unless your employer pays more than the basic SSP entitlement. If you are off sick for 4 or more days, therefore, you’ll be paid at SSP rates for the remainder of your sickness absence.

If you are off for more than 7 days, you can expect to have to provide a Fit Note from your GP to confirm the reason for your absence, so your employer can administer SSP.

You should be paid a normal day’s pay for every day’s holiday.

All workers (including employees) are entitled to 5.6 weeks’ paid annual leave (holiday) each year. Your contract may allow you to take more holiday, and/or may include public holidays within that basic 5.6-week allowance. So, if you work full-time 5 days a week, you’re entitled to at least 4 weeks’ holiday plus the normal 8 public/bank holidays a year (total 5.6 weeks). If an additional bank holiday is declared (such as the Coronation bank holiday in 2023), that will be added to your entitlement, and you shouldn’t have to use a day from your existing entitlement.

Part time workers/employees are entitled to a pro-rated amount of holiday, i.e. 5.6 weeks of their normal working week, which again can include public/bank holidays. So, an employee working 4 days a week is entitled to 5.6 x 4 = 22.4 days’ holiday including public/bank holidays. This is rounded up to the nearest half, so 22.5 days. Assuming the organisation closes on bank holidays, 8 of those days will be “chosen” for the part timer, so they’ll only be able to choose when they take their remaining 14.5 days. Holiday calculation is tricky for anyone not on a regular, full time working pattern. If in doubt, seek advice.

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