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Minimum wage advice please!!
lindseydaniel
Posts: 53 Forumite
Hi,
I recently set up a leaflet distribution business and have had to start to pay other people to deliver for me as the workload is just to much for me.
Are there any implications regarding minimum wage when paying people to distribute?
I pay £25 per 1000 leaflets for people to distribute for me (which is what I got paid when I did it for another large company) but someone queried that it would take them maybe 6 or 7 hours so it is under the minimum hourly wage. I pointed out that I was paying them for per job, not per hour.
Any info please would be greatly appreciated??
Thanks
Daniel
I recently set up a leaflet distribution business and have had to start to pay other people to deliver for me as the workload is just to much for me.
Are there any implications regarding minimum wage when paying people to distribute?
I pay £25 per 1000 leaflets for people to distribute for me (which is what I got paid when I did it for another large company) but someone queried that it would take them maybe 6 or 7 hours so it is under the minimum hourly wage. I pointed out that I was paying them for per job, not per hour.
Any info please would be greatly appreciated??
Thanks
Daniel
0
Comments
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Hey there. Are these people self employed or employed directly by yourself? If you employ them you have to pay them national min wage for every hour they work. If self employed it gets a little more complex. In order to be exempt from national min wage they must be truely self employed ie can choose whether to accept the work or not or are free to do the same kind of work for someone else at the same time HMRC website will have more info on this.
Basically even if you are paying them per leaflets delivered this must still work out that they have been paid at least national min wage for every hour they work. If they havn't, in order to ammend the problem you must back pay the money owed to them or they could complain to HMRC and you could have an enforcement officer investigating you. For further info the direct.gov website has lots of info or you can phone the pay and work rights helpline if you need any further info.0 -
Sounds to me like they are still due NMW.
Leaflet distribution does sound very poorly paid, there have been numerous comments on here that it isn't worth doing. It seems most people realise it doesn't meet NMW and leave rather than try and make a career out of it and enforce NMW.
The only way NMW wouldn't apply is if the operative is both self employed and they state to you what pay rate they require (which you either accept or decline) then they invoice you. As you are setting the pay rate you need to ensure it is high enough i.e. meets NMW.0 -
Do you accept their estimate of how long it would take or is it possible to do in the 4/5 hours covered by NMW?0
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That time is nonsense...no way it takes that long.
I used to deliver my own, as people left a lot in buns instead of delivery.
A street with 100 houses .....half an hour tops?
10 streets ...5 hours tops.
Pick the area well (no long drives etc) and it will take less time.
The obvious thing to do...drop 1000 yourself and time it. Then say "I pay 25 quid for deliveing 1k leaflets which will take you X hours" .
Age comes into NMW too..so kids will be better.
tHi, we’ve had to remove your signature. If you’re not sure why please read the forum rules or email the forum team if you’re still unsure - MSE ForumTeam0 -
the way round it
you sell 1000 leaflets to people for 0.01
If they deliver them you give them a bonus of 25.010 -
Pick the area well (no long drives etc) and it will take less time.
The obvious thing to do...drop 1000 yourself and time it. Then say "I pay 25 quid for deliveing 1k leaflets which will take you X hours" .
That's not how NMW works though. You generally pay people by the hour regardless of their productivity. By all means build productivity targets into their contract and then go down the disciplinary route eventually leading to dismissal if they don't meet them, but you can't not pay someone NMW just because you personally can do a job in a certain time period.
You could of course use Fair Piece Rate which I have discussed on this forum yesterday so you can easily find that thread if you check my recent posts. You will need to check the average pay rate of all workers so if someone is slow then they could legitimately get paid less. However as the average pay rate will have to be NMW plus 20% it could end up costing you more.
As you mention the easiest way to get around it is to employ 16 year olds where NMW is much lower.0 -
buftymctufty wrote: »the way round it
you sell 1000 leaflets to people for 0.01
If they deliver them you give them a bonus of 25.01
But the "bonus" as you call it is just another word for saying you are paying them to deliver the leaflets. It doesn't matter how the leaflets come to be in their possession, at the end of the day you are still paying them to deliver them so NMW applies.0 -
buftymctufty wrote: »the way round it
you sell 1000 leaflets to people for 0.01
If they deliver them you give them a bonus of 25.01
That should go down as the "golden nugget" of MSE advice!
Wonders never cease.
You are still payiing them to deliver leflets, so NMW applies.
Ian0 -
drinkupretty wrote: »Hey there. Are these people self employed or employed directly by yourself? If you employ them you have to pay them national min wage for every hour they work. If self employed it gets a little more complex. In order to be exempt from national min wage they must be truely self employed ie can choose whether to accept the work or not or are free to do the same kind of work for someone else at the same time HMRC website will have more info on this.
Basically even if you are paying them per leaflets delivered this must still work out that they have been paid at least national min wage for every hour they work. If they havn't, in order to ammend the problem you must back pay the money owed to them or they could complain to HMRC and you could have an enforcement officer investigating you. For further info the direct.gov website has lots of info or you can phone the pay and work rights helpline if you need any further info.
These people are classed as self-employed. It's not regular work, they can accept or decline it. It's up to them. They can work for anyone else. It's just casual, flexible part time work. They know the rate of pay prior to distribution.
The thing is you can't work out an hourly rate because it is different depending on the individual and the streets. For instance it may take an elderley person twice as long to deliver the leaflets to the same 1000 letterboxes as a fit young student. Also it would take a lot longer to deliver 1000 leaflets to detached houses to driveways than it would to 1000 terraced houses.
I have done this work for the likes of TNT. They paid £23.50 per 1000 letterboxes delivered to. I done it for a smaller company that paid £25 per 1000. I also delivered about 5500 ikea catalogues for about £280 which took weeks.0 -
They will be in your books as having done the work, if they are then investigated to check they paid tax, then if they just pocketed it, you could end up with any tax bill.lindseydaniel wrote: »These people are classed as self-employed. It's not regular work, they can accept or decline it. It's up to them. They can work for anyone else. It's just casual, flexible part time work. They know the rate of pay prior to distribution.
But this is taken care of in law - and the rate of pay has to be equal to NMW x 1.2. So you'd have to be able to prove/show that it was possible for the average person working the average job that they could achieve NMW. Not "if the person's really fast and their mate helps them, then if the wind's from the west I bet most of the time they could deliver X in an hour so I will pay them NMW for X"lindseydaniel wrote: »The thing is you can't work out an hourly rate because it is different depending on the individual and the streets. For instance it may take an elderley person twice as long to deliver the leaflets to the same 1000 letterboxes as a fit young student. Also it would take a lot longer to deliver 1000 leaflets to detached houses to driveways than it would to 1000 terraced houses.
I have done this work for the likes of TNT. They paid £23.50 per 1000 letterboxes delivered to. I done it for a smaller company that paid £25 per 1000. I also delivered about 5500 ikea catalogues for about £280 which took weeks.
You have to ensure that the people doing the work for you ARE properly self-employed/declaring it, OR accept that responsibility for paying any tax etc might come back at you at some future point.0
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