Minimum Wage Increase

[C1403]

Hello all

Our staff had their last pay review in September (all staff had a 2% increase).

I've just been reading about the minimum wage increase from April. 3 of our 8 staff are under the new minimum wage rate of £7.83 (unqualified).

Come April would we just incase these staff members in line with legislative changes and the others remain as they are? 

I just want to make sure everything is fair for all

Thanks in advance

C

[Mouseketeer]

Hi, I guess it’s more about what settings can afford but how long for instance would it be before your 25yr+ staff regardless of qualifications or experience catch up with your deputy or even manager from some of the very low hourly rates I’ve seen, we are lucky enough to have all staff above this rate at the moment (inc April rise) but my committee have agreed that any % required in future due to this will be given to all. 

[zigzag]

Personally I think that you have to increase everyone to make it fair.

[Inge]

For fairness we always did the same  % increase for all,but  there is no reason that you have to do this, you can just increase the minimum wage earners.. . 

We always felt it unfair to not keep the difference between the wage scales. how long before they all become the same, and with no funding increase due before more increases in living wage etc this will become even  harder in the not too distant future. 

[C1403]

The last pay review (for all staff) of 2% was in September and wouldn't generally be reviewed again until next September. We thought this may actually cover any minimum wage increase in April (I'm all for increasing the minimum wage and would love to pay staff more) 

Th staff in question are above the current min wage but will fall just under the new rate in April. 

I think we'll probably just increase them as per the legislation.

Thanks

 

 

[Mouseketeer]

We gave a 1% to all in Sept with a letter saying it would be reviewed in Apr when the new rate was known and then changing to annual review in April.

[FSFRebecca]

2 hours ago, Mouseketeer said:

We gave a 1% to all in Sept with a letter saying it would be reviewed in Apr when the new rate was known and then changing to annual review in April.

Yes, that's exactly what we did

[C1403]

That's a good idea. 

Maybe we should have done that so it ties in with any April legislative changes (joy of being a committee and not really knowing these things) 

[Mouseketeer]

On 14/12/2017 at 18:18, C1403 said:

That's a good idea. 

Maybe we should have done that so it ties in with any April legislative changes (joy of being a committee and not really knowing these things) 

It’s not to late, give letters in the new year saying annual wage reviews and any increases agreed by the committee will be awarded from April 1st, then increase those you have to April as all have had recent 2%, but I do think you have to consider all staff then at April’19 review unless your finances are rock bottom, I know we’re all about ‘narrowing the gap’ in Early Years but I see this gap narrowing causing a lot of bad feeling amongst staff teams :-( 

[playgroup1]

I have 2 members of staff who this will apply to - being paid just under the newer minimum wage for April. The challenge for me is that my staff are on salaried contracts so their yearly wage plus holiday pay is worked out based on 38 weeks and then paid over 52 weeks. Not sure how I manage an increase mid way through the year. Has anybody done this already and can help?

[Clare_Matthews]

I'd also love an answer to this, we have the same situation!

[Mouseketeer]

Our wages are also worked out like this, the  basic hours they get paid and the amount of accrued holiday each month won’t change just the amount they are paid per hour for them from April.

[Inge]

There may be an easier way but here is how our committee worked it out. (Numbers are examples and not true to dates as each will be individual to the setting) 

Work out the extra pay due each week - ( £5.00) 

Then work out the number of working weeks between the change date and the end of your financial year - (10 weeks) 

They then worked out the holiday pay not yet taken - This may need a bit of calculation into how much holiday was accrued before change date and how much after - depends on how the setting calculates holiday pay. ( our contract gave set weeks we were paid holiday pay, 1 Christmas, 2 Easter and rest in August) (3 weeks)

Add the holiday weeks due to the working weeks - (13 weeks)

This was then multiplied by the weekly amount due  (5x 13 = 65)

That total was then divided by the number of monthly wage packets due from the change date to the end of the financial year. (5)

65/5 = 13 so increase in this example would be  £13.00 per month.. 

 

As an alternative you could just pay the extra for each month as it is earnt - bit like overtime would be - the extra is only paid for the weeks they are working and holiday pay - rest would remain the same.

 

Edited December 17, 2017 by Inge

[C1403]

I just read our contact of employment and it states pay is reviewed annually or as per statutory requirements.

I do agree that we should change to review in April from 2019 so will raise this with Committee.

 

 

[Cait]

On 16/12/2017 at 09:29, playgroup1 said:

I have 2 members of staff who this will apply to - being paid just under the newer minimum wage for April. The challenge for me is that my staff are on salaried contracts so their yearly wage plus holiday pay is worked out based on 38 weeks and then paid over 52 weeks. Not sure how I manage an increase mid way through the year. Has anybody done this already and can help?

Yes.  I did this regularly, and it's not too onerous! 

The simplest way is to look at how much the actual increase is per day, then look at how many days there are until the end of the school year, plus holiday entitlement.  This will give you a round figure to divide by the number of remaining months and add on to what their current salary is now.  

Does that make sense? 

[C1403]

Hi. Me again.

Raising this thread up again as someone mentioned staff being on 'salaried' contracts.

Our bookkeeper emailed today saying that she has read some information from HMRC about minimum wage and companies not realising they are not paying staff correctly. She thinks this may impact us and the way staff are paid (their pay is calculated based on term time hours and spread out so they are paid every four weeks)

Currently:

Contracts state an hourly rate and number of hours each week

(ie £7.83per hour. 20 hours per week)

It also states that they are employed term time only.

Holiday entitlement is 5 weeks to be taken during school holidays. 

Amy thoughts here? I'm confused!. I've looked at the guidance on gov.co.uk and can't really get my head around it.

Thanks All

 

 

[Mouseketeer]

We are paid this way, 38 wks pay split into 12 equal payments with pro rata holiday pay shown monthly as extra. The pre-school learning alliance do our payroll so I just go along with ‘they should know what they’re doing”. I suppose you could change the wording on contracts to say something along the lines of annual pay to be paid in 12 (or 13 if 4 weekly)equal amounts, though I think however you look at it you will have some payments where they have been worked all the weeks in that pay period and would have earnt more than the payment but at other times they might only have worked 2 wks out of 4  in that period so way above hourly rate. I think staff have to agree to amendments in contracts though if you do change anything.

[C1403]

Thanks Mousketeer.

It's really confusing and the fact I can't find anything on here or other forums makes me think it's not something anyone has come across as a concern...

You can identify from our contracts the total annual hours worked (it doesn't state it but you could work it out as the weekly hours are on there and that they work term time with 5 weeks AL).

Will do a little more research as always. 

Roll on September!

 

 

 

 

[louby loo]

I think I read somewhere it was ok as long as staff are fully aware and have the option for normal rather than than 12 regular payments.

 

[C1403]

9 hours ago, louby loo said:

I think I read somewhere it was ok as long as staff are fully aware and have the option for normal rather than than 12 regular payments.

 

Thanks. 

[lynned55]

We do the same - except our holiday pay isnt shown as a separate item on payslip- it is however shown on an annual salary letter.

Your annual salary will be £xyz which includes £XY AL . Or something similar. I cant remember the exact wording.

A long time ago I read that paying like this 'rolled up pay' was not illegal but was unlawful.

[Mouseketeer]

I do believe accrued holiday pay has to be shown as a separate item on pay slips if it’s being paid with the wages.

[lynned55]

I think you are right actually but as no one has ever complained and I have enough to do without sorting that out every month- then it will stay as it is.

until someone else wants to do the payroll 

[Mother_Goose]

It's not necessary to show it as a seperate line on payslips, providing the information has been provided to the employee at some point (i.e. in their contract or a letter confirming base rate and then holiday pay amount). I has this confirmed with LawCall <6 months ago.