Small firms get minimum wage reminder

10 September 2008

Small employers are being urged to make sure that they comply with changes to minimum wage rates due to come into effect in October.

The Forum of Private Business (FPB) has said that businesses could face severe penalties if they do not raise the hourly rate of minimum wage payments next month.

As from 1 October the new minimum wage rates all increase. Workers aged 22 and over must be paid a minimum of £5.73 per hour; workers aged 18 to 21, £4.77 per hour; and workers aged 16 to 17, £3.53 per hour.

Employers who fail to pay the legal rate could be fined by as much as £5,000.

However, a recent survey found that 44 per cent of firms employing just four members of staff (or fewer) are unaware of the pending increase.

Nick Palin, the FPB’s director of finance and administration, said: “These changes come about every year and, although there is an additional cost involved, it is important for small firms to comply with the law.

“Those that don’t comply risk paying an even higher price. Recent examples show that the government is more than willing to prosecute firms if they are in breach of the legislation.”