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Where Taxpayers and Advisers Meet

Put all salary into pension - how to calculate min wage?

Umar
Posts:67
Joined:Wed Aug 06, 2008 3:36 pm
Put all salary into pension - how to calculate min wage?

Postby Umar » Mon Aug 14, 2017 9:50 pm

Hi

I want to top up my pension by putting all my salary in for a few months.
My company operates salary sacrifice so it will go in gross.

I've been told the company has to pay me min wage legally.

How is the minimum per month worked out? Is it?
a) Annual, i.e. (£7.50 x hours in year) divided by 12
b) Monthly, i.e. 22 days worked in August x 7.5 hours per day x £7.50 per hour

I get a different answer for a) and b).

bd6759
Posts:4267
Joined:Sat Feb 01, 2014 3:26 pm

Re: Put all salary into pension - how to calculate min wage?

Postby bd6759 » Mon Aug 14, 2017 11:50 pm

minimum wage is calculated per hour per pay period

Umar
Posts:67
Joined:Wed Aug 06, 2008 3:36 pm

Re: Put all salary into pension - how to calculate min wage?

Postby Umar » Tue Aug 15, 2017 5:09 am

So that means calculation b? (Just checking)

Umar
Posts:67
Joined:Wed Aug 06, 2008 3:36 pm

Re: Put all salary into pension - how to calculate min wage?

Postby Umar » Tue Aug 15, 2017 5:13 am

But this sounds like a)?
https://www.gov.uk/minimum-wage-differe ... ual-salary

(although I understand what you mean by pay reference period i think)

NMW expert
Posts:1
Joined:Tue Aug 15, 2017 8:40 pm

Re: Put all salary into pension - how to calculate min wage?

Postby NMW expert » Tue Aug 15, 2017 8:49 pm

The majority of salaried contracts are not recognised under NMW regulations due to the fact they do not state the actual number of hours the employee works every year. If a salaried contract states you will work XX amount of hours per week then this is not considered a salaried contract and you will be termed as unmeasured worker for the means of calculating NMW. In essence you will refer to a time base calculation where you must be paid at lease NMW/NLW for the hours worked in each pay reference period (PRP). Your employer cannot make the salary sacrifice deduction below the NMW calculation for each PRP.

Umar
Posts:67
Joined:Wed Aug 06, 2008 3:36 pm

Re: Put all salary into pension - how to calculate min wage?

Postby Umar » Tue Aug 15, 2017 9:19 pm

How is the NMW calculated in the month for this purpose?


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