National Minimum Wage: salaried workers and salary sacrifice schemes
Executive summary
- Salaried hours: the government should amend Regulation 21 (5) to allow other payment cycles because the two currently permissible payment cycles (weekly and monthly) do not currently give employers the flexibility they need.
- Salary sacrifice schemes: based on feedback from the AAT Payroll Panel, there do appear to be instances of some employers withdrawing salary sacrifice schemes, or similar arrangements whereby pay deductions are offered in return for goods or services, to avoid non-compliance. As the consultation document notes, this can also mean that workers on low pay can sometimes not be offered the same arrangements as those earning well above National Minimum Wage.
- Compliance: as the consultation notes, "the purpose of the rules is to protect workers from potential exploitation and not to unnecessarily penalise or burden employers". Although that may be the purpose, it is questionable as to whether this is the reality.
