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HMRC internal manual

National Minimum Wage Manual

Types of work: salaried hours work conditions - basic annual hours

Relevant legislation

The legislation that applies to this page is as follows:

National Minimum Wage Regulations 2015, regulation 21(3)

For a worker to be performing salaried hours work (NMWM07020) they must be working under a contract to do salaried hours work and meet all the necessary conditions (NMWM07025). One of these conditions is that the basic annual hours the worker must work under his salaried work contract must be able to be identified or ascertained in accordance with their contract.

Establishing the annual ascertainable basic hours

  • Identify the basic hours in the workers contract.
  • Basic hours will be the hours the worker is contracted to work in a year.
  • Where a contract specifies a minimum number of hours to be worked, such as “at least 40 hours per week”, then is not possible to ascertain the exact number of basic hours and the worker will not be performing salaried hours work.
  • Where a contract specifies a minimum number of hours to be worked plus further hours as necessary or when required, it is not possible to ascertain the exact number of basic hours to be worked for the annual salary and the worker will not be performing salaried hours work.
  • If the contract does not show an annual hours figure then the employer should satisfy you of the total number of hours the worker is contracted to work in a year (the basic hours).
  • If the employer does not provide basic hours which cover the full year (e.g. 52 weeks equals 364 days) then please refer to Operational guidance additional questions.
  • If the employer confirms the hours provided cover the whole year then the basic hours have been ascertained.
  • If the employer does not or is still unable to provide a figure which covers the whole year, then the basic hours cannot be ascertained and the worker will not be performing salaried hours work.
  • The annual hours figure may vary year on year.