NMW Checks - How do the National Minimum Wage checks work? For UK only

Introduction

SmartPay™ by Reward Gateway is the market-leading salary sacrifice and payroll benefits administration portal, running National Minimum Wage (NMW) checks for all of the Reward Gateway provided salary sacrifice products –  RG Cycle to Work, SmartPay Childcare Vouchers, and Holiday Trading. The checks ensure an employee won't fall below the National Minimum Wage when submitting an application via our system. These checks are available for the United Kingdom and Ireland.

NMW checks for employees based in the UK:

In the UK, an employee’s hourly rate is calculated based on their age and whether the employee is an apprentice. When SmartPay™ calculates the National Minimum Wage check, it uses the baseline rates provided on the official UK government website.

As displayed on the website (www.gov.uk), the rates are different for the following categories of employees:

• 23 and over

• 21 to 22

• 18 to 20

• Under 18.

• Apprentice.

This is why we ask clients to provide the date of birth for their employees. We also require employees gross salary data, and current gross salary deductions such as pensions and car loans, allowing the system to calculate every employee’s individual rate at the time of submitting an application. This means applications can be approved instantly with no additional admin work on the side of the employer.
What's more, clients can choose to also have additional % threshold to serve as an additional buffer to the National Minimum Wage rate for the employee.

NMW checks for employees based in Ireland:

In Ireland employee’s hourly rate for the minimum wage depends on their age and whether the employee is an apprentice, as it is in the UK, however, the categories are slightly different. Take a look at them in the table provided in the website Workplace Relations. Anyone who is on another rate but still eligible can be manually approved.

SmartPay™ will take the following rates for the following categories:

• Under age 18 – €6.69.

• Is apprentice – €8.60.

• Experienced worker over 18 – €9.55.

These rates are the highest value within the categories, so no employee will fall below NMW.