To help employers meet National Minimum Wage (NMW) compliance requirements, Dayforce performs a check for the specified pay reference period. See Compliance with UK National Minimum Wage.
Role feature access: Payroll Setup > Payroll Setup > Minimum Wage
Before You Begin:
- Configured earnings for work performed across multiple pay reference periods, or cannot be clearly attributed to a single period.
- Set up earning and deduction groupings.
- Set up employee data mapping rule and qualifiers for NWM worker category.
- Ensure a NMW Worker Category for the employee worker type is added as an employee property to each employee record in the Employment > Employment Properties screen in People.
In the Payroll Setup > Minimum Wage screen, you can set up assessment rules for timed or salaried workers.
To configure a National Minimum Wage rule to assess compliance:
- Go to Payroll Setup > Minimum Wage.
- Click Add.
- In the Worker Type field, select a worker type based on the data mapping rules you’ve set up.
- In the Pay Reference Period field, select how earnings and hours are tracked for a pay run.
- In the Earning Grouping field, select the earning group used to calculate the employee’s hourly rate.
- In the Pay Group(s) Configured field, select one or more pay groups that you want to assess for National Minimum Wage compliance.
- Complete any optional fields. See the reference table below for more information about these fields.
- Click Save.
| Rule Settings | Description |
|---|---|
| Worker Type | Indicates the type of work that the employee performs according to the HMRC requirements for National Minimum Wage compliance. Worker types are set up in the data mapping rules in HR Admin > Employee Data Mapping Rules using the employee property NMW Worker Category. |
| Pay Reference Period | Indicates how the employee earnings and hours are tracked for a pay run. |
|
Earning Grouping Deduction Grouping |
Groups of earnings and deductions used to calculate the employee’s hourly rate. Groups are configured in Payroll Setup > Groupings. When calculating the hourly rate, Dayforce takes into account all the hours associated with these groups. |
| Reduced Hours Grouping |
A group of hourly earnings that you want to exclude from the hourly rate calculation. Used when you need to exclude certain types of hourly earnings from the calculation, such as non-working time. For salaried workers, Dayforce subtracts these hours from the total amount of calculated hours in the pay reference period. For timed workers, Dayforce subtracts these hours from the amount of earned hours. When configuring these earning groups in Payroll Setup > Groupings, you need to select the Hours Based and Minimum Wage checkboxes. |
| Minimum Wage Uplift | The amount added to increase all HMRC National Minimum Wage rates. The resultant new rates are used to assess compliance. You can enter only positive values, up to two decimal places. |
| Minimum Wage Override | The amount that overrides all HMRC National Minimum Wage rates. The rate is used to assess compliance for all workers and apprentices. |
| Salaried Worker Hours Calculation | Defines how the Minimum Wage feature calculates hours for salaried workers. You must select Normal Weekly Hours. |
| Pay Group(s) Configured | The pay groups that are accessed for minimum wage compliance. |
| Weeks per Year Multiplier Override | Defines the number of weeks used in calculating the salaried workers’ hours. By default, the Minimum Wage feature uses 52 weeks a year. |
| Include Retro | Indicates the calculation includes retroactive payments within the pay reference period. By default, the checkbox is not selected. When the checkbox is not selected, retroactive payments that are outside the pay reference period are excluded. |