Wages
National minimum wage
There are different rates of national minimum wage (NMW) for five categories of worker:
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National living wage (NLW): This rate was introduced on 1 April 2016 and applies to workers aged 25 and over (National Minimum Wage (Amendment) Regulations 2016). It will be extended to 23 and 24-year olds from 1 April 2021 (see Legal update, National minimum wage increases announced for April 2021) The NLW should not be confused with the Living Wage (sometimes called the "real Living Wage") set by the Living Wage Foundation, a campaigning organisation which promotes a voluntary minimum hourly rate of pay calculated according to the basic cost of living (with a higher rate for London).
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Standard adult rate: This rate applies to workers aged 21 to 24. From 1 April 2021 it will only apply to 21-22 year-olds, as 23 and 24 year-olds will become entitled to the NLW (above).
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Development rate: This rate applies to workers aged 18 to 20 inclusive (regulation 4(1)(b), National Minimum Wage Regulations 2015 (SI 2015/621) (NMW Regulations 2015)).
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Young workers rate: This rate applies to workers aged under 18 but above the compulsory school age who are not apprentices (regulation 4(1)(c), NMW Regulations 2015).
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Apprentice rate: This rate applies to apprentices under 19 years of age, and those aged 19 and over who are in the first year of their apprenticeship (regulations 4(1)(d), and 5(1), NMW Regulations 2015).
If an employer provides a worker with accommodation, some of its value can be counted towards NMW pay (regulation 16(1) and (2), NMW Regulations 2015). This is the "accommodation offset". An employer cannot deduct more than the accommodation offset from the worker's minimum wage figure.
These figures are reviewed each year, following recommendations by the Low Pay Commission. The current figures were prescribed by the National Minimum Wage (Amendment) Regulations 2020. New rates will be introduced on 1 April 2021 (see Legal update, National minimum wage increases announced for April 2021).
Agricultural wages in Scotland
Minimum wage and other allowances for agricultural employees in Scotland are covered by the Agricultural Wages (Scotland) Order (the Wages Order). The Wages Order is updated annually, with a new Wages Order taking effect from 1 April each year. The Wages Order effective from 1 April 2020 is the Agricultural Wages (Scotland) Order (No.67) 2020. The revised Wages Order is generally published in advance, so employers know the new rates of pay and allowance which apply from 1 April each year.
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Minimum wage for agricultural employees: The Wages Order applies a single rate of pay to agricultural employees, regardless of age. This rate cannot fall below the national minimum wage.
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Minimum wage for agricultural apprentices: From 1 April 2020, this applies to agricultural apprentices under 19 or 19 and over and in the first year of their apprenticeship. Agricultural apprentices aged 19 and over and who have completed at least one year of their apprenticeship are paid the same as normal agricultural employees. Prior to 1 April 2020, whether an agricultural apprentice was paid the lower apprenticeship rate or the normal rate depended not on age and stage of the apprenticeship, but on whether the apprentice had been continuously employed by the same employer for up to 18 months. Under 18 months, the apprenticeship rate was applicable, after 18 months, agricultural apprentices were paid the same as normal agricultural employees.
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Additional payment: Certain agricultural employees are entitled to an additional hourly payment. These employees are those:
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Holding a Scottish or National Vocational Qualification in an agricultural subject at SCQF level 6 or above.
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With an apprenticeship certificate approved by Lantra (previously, ATB Landbase).
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With a certificate of acquired experience issued by ATB Landbase.
If the employer provides an agricultural employee with accommodation, some of its value can be counted towards the agricultural minimum wage. The value is set by the Wages Order. An employer cannot deduct more than the value set by the Wages Order from the employee’s minimum wage.
Week's pay
The statutory limit on a gross week's pay (section 227, Employment Rights Act 1996) is adjusted annually by the Secretary of State in line with RPI under a formula set out in section 34 of the Employment Relations Act 1999. The statutory limit from 6 April 2019 was prescribed by the Employment Rights (Increase of Limits) Order 2019 (SI 2019/324).
There is no minimum amount. The limit is raised every 6 April in line with any annual increase in RPI measured in the previous September. If there is no change or a decrease in RPI, the limit remains the same.