Release Notes WFM UK: National Minimum Wage and National Living Wage Export

What’s changing?

The Payroll module reporting function has been amended to introduce a new export to help customers to check  National Minimum Wage and National Living Wage (NMW/NLW) .

There will be an immediate impact on the existing National Minimum Wage export and the National Minimum Wage Compliance (Shifts) Report which will be removed from the People System and replaced with the new NMW/NLW  Export.

This export should be used as a guide to help identify employees who may be paid below the National Minimum Wage.  please see the Considerations section towards the bottom of the article for more information.

If any technical issues are encountered with the new export, please raise a Technical Case with our Support Team regarding the issue. To do so, either escalate to the member of your business who is responsible for raising cases with Fourth or raise a Technical Case in the Customer Community.
 

Proposed Release Date: 9th June 2016

Reason for the Change

National Living Wage (NLW) became effective from 1st April 2016, people system has already been updated to enable compliance with NMW/NLW.

This new export has been developed in order to be able to provide guidance on employees who may be at risk of non-compliance with NMW/NLW legislation. The export defaults to all payments included in the calculation of NMW/NLW unless the payment type has been excluded in the calculation.
 

Customers Affected

All customers with the Payroll Module.
 

Release Notes
 

User Access

Access to the NMW/NLW export will require access to exports. This can be assigned to employees with bespoke access or through access templates and is simply the permission named ‘Exports’ within the Payroll module.– Please note this will give access to all exports sitting within your Payroll module.

Should you require any guidance with assigning access, please liaise with your Fourth contact to have this this setting applied.

Configuration

High level release notes sent out on Friday 3rd June 2016 to our In-House Payroll customers included details of how to configure HR & Payroll to ensure that only the payment types that count toward minimum wage are included in the calculation. For our Payroll Bureau customers, please contact your Payroll Specialist in the Payroll Bureau if you have any queries on what is included.

Contracted Hours

The NMW/NLW export uses contracted hours in the employee’s 'Employment Details' page to calculate salaried employee’s hourly rate. Therefore you will need to update salaried employees contracted hours. To enable the 'Contracted Hours' option you will need to enable the Global Setting:

• Go to HR > administration > Global Settings > edit default employee settings > Display Contracted Hours > choose Mandatory which will force managers to update this option

To update employee's contracted hours:

• Go to HR > Employees > Employees list > select/search the Employee > Employee Info > Employment Details > see Contracted Hours > update with hours worked by the Employee > Save
   

NMW/NLW for tax year Export

• The new Export can be found in Payroll > Reports > Exports> NMW/NLW for tax year
   

In order to run the Export, a Company and Pay Basis should be specified.
 

• Company - Only a single Company can be selected
• Location - Can specify Location or select all Locations applicable to the company
• Division - Can specify location or select all Locations applicable to the company
• Pay Basis - Only a single Pay Basis can be selected
• Show all employees – When ticked, all employees will show on the report including those who are compliant. This will then allow the user to review all employees and make decisions
• Use Rota Hours for Salaried Employees - When ticked, the actual hours scheduled for salaried employees will be used for the calculations.

You will then have the option to run the export or reset the selection criteria.
 

Calculations and Column Definition

The export covers different employee types, however the calculations for each are specific. National Minimum/Living Wage is calculated based on the number of hours worked.
 

Export Example

Considerations

Due to the complex legislation surrounding the calculation of National Minimum and National Living Wage, this export should only be used as a guide to help ensure employee's are being paid the minimum or above.

The following aspects may not be included in the calculations, depending on the configuration of the portal

• Employees paid on an annual salary and contracted to work shifts
• Pro Rata Salaries due to employee age changes, apprentice changes or minimum wage rate changes
• Holiday pay for salaried employees 
• Any aspect of employee pay that are not available within the payroll calculations that may impact their calculations.

Any employee's flagged as being below the National Living Wage should be reviewed according to their circumstances, and top up payment amounts applied, if necessary