NMWM08050 - Working time: salaried hours work: considering adjustments for starting employment
Relevant legislation
General
Worker starts employment
Example of calculating hours worked in a shortened pay reference period
Relevant legislation
The legislation that applies to this page is as follows:
- National Minimum Wage Regulations 2015, regulation 22
General
The hours to be treated as worked in each pay reference period (NMWM09010) for a worker performing salaried hours work is based on a calculation using the worker’s basic hours (NMWM08030). This calculation enables annualised hours in a calculation year (NMWM08040) to be treated as being worked evenly throughout a year. However, when a worker starts or ends (NMWM08060) their employment it is necessary to ensure that any part worked pay reference period is taken into account.
Worker starts employment
Where a monthly paid worker starts their employment part way through a month, their initial calculation year will be slightly longer than a calendar year (see Example 2 of NMWM08040). In this instance, the first pay reference period will be less than a month and a pro-rata calculation is required to identify the time to be treated as worked for the first pay reference period:
B x N
365
Where
B is the worker’s basic hours (NMWM08030), and
N is the number of days in the shortened pay reference period.
This calculation is not required for a worker performing salaried hours work who is paid weekly or monthly and is engaged for the entire pay reference period as there is no shortened pay reference period.
Example of calculating hours worked in a shortened pay reference period
A four weekly paid worker performing salaried hours work has 2080 basic hours and starts employment on 13 April 2021. The four-weekly pay reference period starts 5 April 2021 and ends 2 May 2021.
- The time treated as worked for each full pay reference period is 160 hours based on the calculation, 2080 ÷ 13 (NMWM08035)
- The number of days in the first pay reference period is 20 based on the period 13 April to 2 May inclusive.
- The time treated as worked for the shortened, initial pay reference period is;
2080 x 20 = 113.97 hours 365
For this worker the hours treated as worked in the initial, shortened pay reference period is 113.97 hours with each subsequent following pay reference period being 160 hours.
This means that for the initial calculation year 13 April 2021 to 12 April 2022, the total basic hours will remain 2080.