Equal Pay

Equal pay is your entitlement to the same wage as someone doing work of equal value to you, the same or broadly similar work as you or work rated as “of equivalent value” by a job evaluation study.

This is often, but not exclusively, a gender issue. Women are sometimes paid less than men for doing the same work.

Employees can compare any terms in the contract of employment with the equivalent terms in a comparators contract.  An employer may defend a claim if they show the reason for the difference is due to a genuine factor and not based on the sex of the employee.

Employees are also entitled to know how their pay is made up. For example, if there is a bonus system, everyone should know how to earn bonuses and how they are calculated.

The Equality Act 2010 makes it unlawful to prevent employees from having discussions to establish if there are differences in pay. However, an employer can require their employees to keep pay rates confidential from people outside of the workplace.

The equal terms can cover all aspects of pay and benefits, including:

• basic pay
• overtime rates
• performance related benefits
• hours of work
• access to pension schemes
• non-monetary terms
• annual leave entitlements.

What to Do if You Think You Are Not Receiving Equal Pay

An employee who thinks they are not receiving equal pay can write to their employer asking for information that will help them establish whether there is a pay difference and if so the reasons for the difference.

If an employee cannot resolve the problem informally or through the formal grievance procedure, they may complain to an employment tribunal under the Equality Act 2010 while still working in the job or up to six months after leaving the employment to which your claim relates.

National Minimum Wage

The rate a worker is entitled to will depend on their age and if they are an apprentice. Most workers will be entitled to the National Minimum Wage (NMW). HM Revenue & Customs can take employers to court for not paying the NMW.

The NMW rates are reviewed each year by the Low Pay commission and as of April 2017 are:

• £7.50 for workers 25 and over
• £7.05 for workers 21 – 24 years
• £5.60 for 18 -20 years,
• £3.50 for apprentices

These will increae in April 2018 to:

• £7.83 for workers 25 and over
• £7.83 for workers 21 – 24 years
• £5.90 for 18 -20 years,
• £3.70 for apprentices

It is important to note that these rates, which come into force in April every year, apply to pay reference periods beginning on or after that date.

There are a number of people who will not be entitled to the NMW these include:

• self-employed people
• volunteers
• voluntary workers
• company directors
• Some agricultural workers
• Some family members, or people who live in the family home of the employer who undertake household tasks

All other workers must receive at least the NMW. There are no exemptions according to size of business or by sector, job or region.

Apprentices

The apprenticeship rate only applies to:

• apprentices aged under 19
• apprentices aged 19 or over who are in the first year of their apprenticeship

Any apprentices aged 19 or over in their second year of apprenticeship must receive the national minimum wage or national living wage rate their age entitles them to.