Workplace Report (December 2009)

Law - Contracts

Minimum wage applies to basic hours and cannot include additional shift allowances and enhancements

Case 4: The facts

Ms Hillier worked as a care worker. Her basic pay rate was below the National Minimum Wage. However, she was entitled to time plus one third for weekday nights and time plus two-thirds for weekend nights. As Ms Hillier always worked nights (except for occasional training days), in practice her total pay was never below the National Minimum Wage.

Despite this, the employment tribunal upheld Ms Hiller’s claim under the National Minimum Wage Act 1998. It rejected the employer’s contention that her basic rate was the pay she actually received when working nights. The tribunal said Ms Hillier should be paid the National Minimum Wage plus her usual night enhancements. The employer appealed.

The ruling

The EAT rejected the appeal. Under regulation 31(1)(c)(i) of the National Minimum Wage Regulations 1999, only Ms Hillier’s basic rate of pay counted towards the minimum wage.

Commentary

The EAT said the philosophy underlying the minimum wage legislation was clearly that an employee’s basic minimum wage before overtime enhancement or other allowances should not fall below the statutory minimum. It would be completely contrary to the purpose of the legislation if that obligation could be avoided simply because an employee normally worked those hours when she would be in receipt of some enhancement.

Hamilton House Medical Ltd v Hillier UKEAT/0246/09

This information is copyright to the Labour Research Department (LRD) and may not be reproduced without the permission of the LRD.