Training costs are reductions for national minimum wage purposes (Commissioners for HMRC v Ant Marketing)

Table of contents

• What are the practical implications of this judgment?
• What is the relevant background?
• Background law
• Background facts
• The decision of the employment tribunal
• What did the EAT decide?
• Case details

Article summary

Employment analysis: For the purposes of calculating whether the national minimum wage has been paid, deductions for the cost of training may be treated as reductions (reducing the total pay used to calculate the hourly rate paid) because it is expenditure ‘in connection with employment’ within the meaning of regulation 13 of the National Minimum Wage Regulations 2015 even if the deductions (i) are a contractual liability, (ii) are contingent on the event of an employee leaving within 12 months of commencing employment, (iii) only represent a proportion of the costs incurred by the employer, and (iv) the training is not mandatory (although if it is mandatory, and employment cannot be secured without it, the expenditure is all the more likely to be regarded as being in connection with employment), according to the EAT.