New Minimum Wage & Holiday Entitlements
21st September 2007

Bradford Chartered Accountants Naylor Wintersgill are advising local businesses to be aware of imminent changes to both statutory holiday entitlements and the national minimum wage.

From October 1st, employees aged 22 and above will be entitled to £5.52 per hour as opposed to £5.35. The rate for those aged between 18 and 21 will increase from £4.45 per hour to £4.60, while 16-17 year old employees will see a rise from £3.30 to £3.40.

Vaughan Houldsworth, Tax Partner at Naylor Wintersgill, comments,

‘When calculating the minimum wage, businesses need to be aware that this should be done using employees gross pay and several key elements should be used in the calculation. These include bonus and commission payments for the pay period; tips, gratuities and service charges paid through the payroll; payments received as part of an incentive and piecework.’

A further change effective from 1st October is an increase in the holiday entitlement, from 20 days a year to 24 days for employees who work 5 days per week, applicable pro rata for part time employees. There will be an additional increase from 1st April 2009, which will see the entitlement rise to 28 days. The new 24-day entitlement includes public and bank holidays.

The new 24-day entitlement can include public and bank holidays, meaning that employees are effectively allowed 16 days paid holiday on top of these.