Salons warned to be prepared for National Minimum Wage increase this week

The National Minimum wage will increase from this Thursday, October 1, meaning that beauty businesses will have to be even more careful that they are paying staff the correct minimum wage.

The sharpest increase will be on apprentice wages, for those ages 16-18 or 19 or over in the first year of an apprenticeship. It will increase 21% from £2.73 to £3.30. The adult wage will increase by 20p to £6.70.

In July we reported that HM Revenue and Customs was introducing an enforcement and compliance campaign, launched to crack down on employers who pay their staff below the National Minimum Wage. As part of the campaign, HMRC will give employers tools and guidance to check whether they are paying the correct amount, and make corrections if they are not.

Salon owners will be given six months to take this opportunity to “self-correct” their pay. After the six-month grace period, if employers are found to be paying below the NMW or to have paid unfairly in the past and not reimbursed the employee, then HMRC will take action against them, which could result in a fine of up to £20,000 per employee, and in being named publically.

These fines for non-compliance actually increased from May this year – the £20,000 sum was previously in total rather than per underpaid employee. And from next year the Government has promised to be even tougher in targeting employers who do not comply as the compulsory National Living Wage for workers aged 25 or over is brought in from April. The penalty for non-payment will be double the amount owed, unless payment is made within 14 days. 

Commenting on this week's NMW increase, Paul Curry, president of the National Hairdressers’ Federation said: “Now’s the time to double check your payment processes to make absolutely sure your staff are being paid their rightful wage.  It is important your system can adjust an employee’s wage when they have a birthday that takes them on to a new rate, or when they have finished their first year of apprenticeship training if they are aged 19 or over.  Our key message for salons is: don’t get caught out this Thursday”.