Employer's manner of calculating hours means I was paid below NMW

pkwpkw1

I started a new job but left after 2 weeks. I worked 6 hours a day for 5 days in a week x 2 weeks, a total of 60 hours. However, when I got my payslip, I saw that I was paid only for 42 hours. When I asked for an explanation, I was sent the following explanation of the way the employer worked out my hours:

The hours of pay per day can be found, as follows.

(30 hours contracted per week X 52.179 averaged weeks per year) / 12 months in the year = 130.45 hours per month, every month.

The daily amount of hours paid each month will vary but the total hours in the month will not.

130.45 hours per month / days in the month eg 31 = hours per day.

Hours per day x days employed and not unpaid absent = paid monthly hours.

The actual work schedule and the days you have worked are not relevant under this system.

So using the above formula, they arrived at a figure of 42 hours. I don't really understand why it's done that way or whether it's correct. It means that effectively, by being paid for 42 hours while having actually worked 60, I was working for well below the NMW. Can someone comment on this? Is this something I can argue about? Thanks.

Flugelhorn

"130.45 hours per month / days in the month eg 31 = hours per day."

looks like problem may be here - there are only 20 working working days in most months  - so approx 6 hours a day whereas they are calculating this at about 4.3 hrs per day 

Savvy_Sue

And if they don't budge, you can report to the minimum pay unit at HMRC. I think you'd start here: https://www.gov.uk/government/organisations/hm-revenue-customs/contact/national-minimum-wage-enquiries-and-complaints

NCC1701-A

pkwpkw1 said:

I started a new job but left after 2 weeks. I worked 6 hours a day for 5 days in a week x 2 weeks, a total of 60 hours. However, when I got my payslip, I saw that I was paid only for 42 hours. When I asked for an explanation, I was sent the following explanation of the way the employer worked out my hours:

The hours of pay per day can be found, as follows.

(30 hours contracted per week X 52.179 averaged weeks per year) / 12 months in the year = 130.45 hours per month, every month.

The daily amount of hours paid each month will vary but the total hours in the month will not.

130.45 hours per month / days in the month eg 31 = hours per day.

Hours per day x days employed and not unpaid absent = paid monthly hours.

The actual work schedule and the days you have worked are not relevant under this system.

So using the above formula, they arrived at a figure of 42 hours. I don't really understand why it's done that way or whether it's correct. It means that effectively, by being paid for 42 hours while having actually worked 60, I was working for well below the NMW. Can someone comment on this? Is this something I can argue about? Thanks.

After 2 weeks you will have accrued 1 days annual leave too.

pramsay13

Does your payslip say you've worked 42 and there's a lower hourly rate or is it a single amount that you've worked out to be 42 hours pay?
Does it include tax and NI? 
Might be worth a screenshot of your payslip and rub out your personal details. 

zagfles

pkwpkw1 said:

I started a new job but left after 2 weeks. I worked 6 hours a day for 5 days in a week x 2 weeks, a total of 60 hours. However, when I got my payslip, I saw that I was paid only for 42 hours. When I asked for an explanation, I was sent the following explanation of the way the employer worked out my hours:

The hours of pay per day can be found, as follows.

(30 hours contracted per week X 52.179 averaged weeks per year) / 12 months in the year = 130.45 hours per month, every month.

The daily amount of hours paid each month will vary but the total hours in the month will not.

130.45 hours per month / days in the month eg 31 = hours per day.

Hours per day x days employed and not unpaid absent = paid monthly hours.

The actual work schedule and the days you have worked are not relevant under this system.

So using the above formula, they arrived at a figure of 42 hours. I don't really understand why it's done that way or whether it's correct. It means that effectively, by being paid for 42 hours while having actually worked 60, I was working for well below the NMW. Can someone comment on this? Is this something I can argue about? Thanks.

It looks like they say you were only employed for 10 days. Did you work 10 days solid? If they're going to divide by 31 for total days in the month (ie not just working days) then they also need to include all days you were employed, not just the days you worked. For instance if you worked Mon-Fri for 2 weeks then that should be 14 days not 10. 

saajan_12

pkwpkw1 said:

I started a new job but left after 2 weeks. I worked 6 hours a day for 5 days in a week x 2 weeks, a total of 60 hours. However, when I got my payslip, I saw that I was paid only for 42 hours. When I asked for an explanation, I was sent the following explanation of the way the employer worked out my hours:

The hours of pay per day can be found, as follows.

(30 hours contracted per week X 52.179 averaged weeks per year) / 12 months in the year = 130.45 hours per month, every month.

The daily amount of hours paid each month will vary but the total hours in the month will not.

130.45 hours per month / days in the month eg 31 = hours per day.

Hours per day x days employed and not unpaid absent = paid monthly hours.

The actual work schedule and the days you have worked are not relevant under this system.

So using the above formula, they arrived at a figure of 42 hours. I don't really understand why it's done that way or whether it's correct. It means that effectively, by being paid for 42 hours while having actually worked 60, I was working for well below the NMW. Can someone comment on this? Is this something I can argue about? Thanks.

The problem is they're dividing by the calendar days (31), but then multiplying by the number of worked days (10). They need to make these consistent, so either
* divide by the number of working days ie 20; or
* multiply by 7 days / week if you're working the full allocation (30 hrs / week)

SomeJohnDoe

saajan_12 said:

pkwpkw1 said:

I started a new job but left after 2 weeks. I worked 6 hours a day for 5 days in a week x 2 weeks, a total of 60 hours. However, when I got my payslip, I saw that I was paid only for 42 hours. When I asked for an explanation, I was sent the following explanation of the way the employer worked out my hours:

The hours of pay per day can be found, as follows.

(30 hours contracted per week X 52.179 averaged weeks per year) / 12 months in the year = 130.45 hours per month, every month.

The daily amount of hours paid each month will vary but the total hours in the month will not.

130.45 hours per month / days in the month eg 31 = hours per day.

Hours per day x days employed and not unpaid absent = paid monthly hours.

The actual work schedule and the days you have worked are not relevant under this system.

So using the above formula, they arrived at a figure of 42 hours. I don't really understand why it's done that way or whether it's correct. It means that effectively, by being paid for 42 hours while having actually worked 60, I was working for well below the NMW. Can someone comment on this? Is this something I can argue about? Thanks.

The problem is they're dividing by the calendar days (31), but then multiplying by the number of worked days (10). They need to make these consistent, so either
* divide by the number of working days ie 20; or
* multiply by 7 days / week if you're working the full allocation (30 hrs / week)

Saajan_12 is right.

They should divide by working days (varies between 20 to 23 in a month but averages to 21.75 days month) not by calendar days. Nobody works 365 days a year, but according to their calculations you do!

What's interesting is why they are even using that calculation and not just doing:
30 hours x 2 weeks x hourly rate (or average hourly rate if salary based).

I would suggest you ask for clarity as to why they've calculated that way. Just ensure the 60 total hours you worked doesn't include any unpaid lunch breaks.

DullGreyGuy

pkwpkw1 said:

I started a new job but left after 2 weeks. I worked 6 hours a day for 5 days in a week x 2 weeks, a total of 60 hours. However, when I got my payslip, I saw that I was paid only for 42 hours. When I asked for an explanation, I was sent the following explanation of the way the employer worked out my hours:

The hours of pay per day can be found, as follows.

(30 hours contracted per week X 52.179 averaged weeks per year) / 12 months in the year = 130.45 hours per month, every month.

The daily amount of hours paid each month will vary but the total hours in the month will not.

130.45 hours per month / days in the month eg 31 = hours per day.

Hours per day x days employed and not unpaid absent = paid monthly hours.

The actual work schedule and the days you have worked are not relevant under this system.

So using the above formula, they arrived at a figure of 42 hours. I don't really understand why it's done that way or whether it's correct. It means that effectively, by being paid for 42 hours while having actually worked 60, I was working for well below the NMW. Can someone comment on this? Is this something I can argue about? Thanks.

Were you salaried or hourly rate?

pkwpkw1

Thanks for all the replies, I will try to answer questions in one post.

It does indeed seem strange that they used 31 days in the month instaed of 20 for the calculation.

This was a salaried position, contracted for 30 hours a week, 5 days over 7. I worked 2 weeks excluding weekends.

My payslip shows the Basic Pay for 42.05 hours, and also a small amount of Arrears of Basic Pay - I think this is due to the fact that my first day of work was the previous calendar month.

I've already spoken to ACAS, although they couldn't comment on the specific calculation, they advised to speak to the employer first and then if the answer is unsatisfactory, I might want to open a case of unlawful deductions. This was before they emailed me the above formula, so I'm not sure what would be the next step now.

I will also clarify 2 more things but not sure they are relevant. The actual number of days I worked was 54 not 60, as I didn't complete the last day. The reason I said 60 in the beginning is that from their side they included that day in the pay (I did mention that fact to them), but even with 54 the pay is still too low. The second thing is breaks, they were unpaid 20 mins break, but it was normal to work through them and the start/finish times were without breaks.

Marcon

pkwpkw1 said:

Thanks for all the replies, I will try to answer questions in one post.

It does indeed seem strange that they used 31 days in the month instaed of 20 for the calculation.

This was a salaried position, contracted for 30 hours a week, 5 days over 7. I worked 2 weeks excluding weekends.

My payslip shows the Basic Pay for 42.05 hours, and also a small amount of Arrears of Basic Pay - I think this is due to the fact that my first day of work was the previous calendar month.

I've already spoken to ACAS, although they couldn't comment on the specific calculation, they advised to speak to the employer first and then if the answer is unsatisfactory, I might want to open a case of unlawful deductions. This was before they emailed me the above formula, so I'm not sure what would be the next step now.

I will also clarify 2 more things but not sure they are relevant. The actual number of days I worked was 54 not 60, as I didn't complete the last day. The reason I said 60 in the beginning is that from their side they included that day in the pay (I did mention that fact to them), but even with 54 the pay is still too low. The second thing is breaks, they were unpaid 20 mins break, but it was normal to work through them and the start/finish times were without breaks.

If you left after two weeks how could you have worked 54 days?

This is all getting very confusing. Why not make a complaint to your ex-employer that you weren't paid minimum wage and if that gets nowhere:

 Savvy_Sue said:

And if they don't budge, you can report to the minimum pay unit at HMRC. I think you'd start here: https://www.gov.uk/government/organisations/hm-revenue-customs/contact/national-minimum-wage-enquiries-and-complaints