NMWM08141 - Working time: salaried hours work: excess hours calculation for pay reference periods for remainder of calculation year once basic hours exceeded: monthly example
Calculation for remaining pay reference periods in the calculation year
To calculate the hours to be treated as worked for National Minimum Wage purposes in pay reference periods following that in which the basic hours were first exceeded, all that is necessary is to add together:
- the hours initially calculated using the basic hours (those hours have effectively already been worked prior to this point but have not yet been considered for National Minimum Wage); and
- all the hours actually worked, or treated as worked (NMWM08100) in the pay reference period.
Example: calculation in pay reference periods following that in which basic hours first exceeded
A monthly paid worker performing salaried hours work has a calculation year from 1 April to 31 March with 2080 basic hours (resulting in 12 months of 173.33 hours being treated as worked each pay reference period).
By February the worker exceeded the basic hours.
In March the worker worked 186 hours.
The hours treated as worked for March will be;
| Step | Description | Action | Hours treated as worked |
|---|---|---|---|
| 1. | Hours calculated per basic hours (already worked prior to excess hours) | - | 173.33 |
| 2. | Hours actually worked or treated as worked in the pay reference period | + | 186.00 |
| - | Total hours treated as worked | = | 359.33 |
The adjusted number of hours to be treated as worked in March is 359.33 hours which is the sum of (1) 173.33 and (2) 186.00. This means that as a consequence of the excess hours the employer must increase the number of hours treated as worked for the purposes of National Minimum Wage from 173.33 to 359.33 hours.
This calculation is repeated in all remaining pay reference periods in the calculation year. (In this example, there are no further pay reference periods as March is the final pay reference period in the calculation year.)