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NMW and directors

by | Aug 22, 2018 | Employment | 0 comments

The national minimum wage (NMW) rates rise on 1 April 2018. Are you certain you know what pay rise you must give to employees and whether the directors should be included in those calculations?

Most directors of their own companies do not have to pay themselves the NMW. This is the case where the director does not have a contract of employment with the company and is effectively paid only for their role as an office holder.

In a company which has a number of employees, good employment practice would be to require everyone to abide by the terms and conditions set out in the employment handbook and to sign a declaration on »

The five NMW rates depend on each employee’s age and whether they are on an approved apprenticeship scheme. The top rate for those aged 25 and over will rise from £7.50 to £7.83, up 4.4%.

Where the director does have an employment contract with the company, they will be treated as an employee for NMW purposes and the NMW should be paid for all the hours they work.


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