Tag: National Minimum Wage

HMRC reveals absurd excuses for not paying Minimum Wage

While the vast majority of employers pay their employees at least the National Minimum Wage, HM Revenue and Customs (HMRC) has today released some of the most absurd excuses used for not paying the legal minimum.

Last year (2020 to 2021) HMRC helped more than 155,000 workers across the UK recover more than £16 million in pay which was due to them, and also issued more than £14 million in penalties.

Some of the most ridiculous excuses for flouting the law included:

  1. “She does not deserve the National Minimum Wage because she only makes the teas and sweeps the floors.”
  2. “The employee was not a good worker, so I did not think they deserved to be paid the National Minimum Wage.”
  3. “My accountant and I speak a different language – he does not understand me, and that is why he does not pay my workers the correct wages.”
  4. “My employee is still learning so they are not entitled to the National Minimum Wage.”
  5. “It is part of UK culture not to pay young workers for the first three months as they have to prove their ‘worth’ first.”
  6. “The National Minimum Wage does not apply to my business.”
  7. “I have got an agreement with my workers that I will not pay them the National Minimum Wage; they understand, and they even signed a contract to this effect.”
  8. “I thought it was okay to pay young workers below the National Minimum Wage as they are not British and therefore do not have the right to be paid it.”
  9. “My workers like to think of themselves as being self-employed and the National Minimum Wage does not apply to people who work for themselves.”
  10. “My workers are often just on standby when there are no customers in the shop; I only pay them for when they are actually serving someone.”

Steve Timewell, Director Individuals and Small Business Compliance, HMRC, said: “The majority of UK employers pay their workers at least the National Minimum Wage, but this list shows some of the excuses provided to our enforcement officers by less scrupulous businesses. Being underpaid is no joke for workers, so we always apply the law and take action. Workers cannot be asked or told to sign-away their rights.

“We are making sure that workers are being paid what they are entitled to and, as the economy reopens, reminding employers of the rules and the help that is available to them.

“HMRC reviews every complaint made about the minimum wage, so if you think you are being short-changed, or are a business that is unsure of the rules or needs help to get things right, get in touch and we will help you. But any employer deliberately or unapologetically underpaying their staff will face hefty fines and other enforcement action.”

The National Minimum Wage hourly rates are currently:

·         £8.91 – Age 23 or over (National Living Wage)

  • £8.36 – Age 21 to 22
  • £6.56 – Age 18 to 20
  • £4.62 – Age under 18
  • £4.30 – Apprentice.

HMRC is reminding workers to check the hourly rate of pay they are actually getting, and to also check any deductions or unpaid working time, as part of the Government’s commitment to build back fairer from the pandemic.

Anyone not being paid what they are entitled to can complain online at https://www.gov.uk/minimum-wage-complaint.

If they want to speak with someone, in confidence, they should phone the Acas Pay and Work Rights Helpline on 0300 123 1100, who can transfer the call to HMRC.

Employers can also contact the Acas Helpline for free help and advice or visit https://www.gov.uk/guidance/calculating-the-minimum-wage to find out more.

191 employers named and shamed for cheating their workers

  • Government names and shames 191 employers who have underpaid workers, including major household names
  • named firms have been fined for owing £2.1 million to over 34,000 workers
  • Business Minister Paul Scully: “Employers that short-change workers won’t get off lightly”

Today (Thursday 5 August) 191 businesses are being named for breaking national minimum wage law. Twenty-two of them are in Scotland.

Following investigations by Her Majesty’s Revenue and Customs, a total of £2.1 million was found to be owed to over 34,000 workers.

The breaches took place between 2011 and 2018. Named employers have since been made to pay back what they owed, and were fined an additional £3.2 million, showing it is never acceptable to underpay workers.

The UK government recently gave millions a pay rise, by increasing National Living Wage and National Minimum Wage rates in April 2021. The rise means someone working full time on the National Living Wage will be taking home £5,400 more annually than they were in 2010. Every single UK worker is entitled to the National Minimum Wage, no matter their age or profession.

Whilst not all minimum wage underpayments are intentional, it has always been the responsibility of all employers to abide by the law. Clear guidance is available on gov.uk, which all employers should check.

Minimum wage breaches can occur when workers are being paid on or just above the minimum wage rate, and then have deductions from their pay for uniform or accommodation.

The employers named today previously underpaid workers in the following ways:

  • 47% wrongly deducted pay from workers’ wages, including for uniform and expenses
  • 30% failed to pay workers for all the time they had worked, such as when they worked overtime
  • 19% paid the incorrect apprenticeship rate

Business Minister Paul Scully said: “Our minimum wage laws are there to ensure a fair day’s work gets a fair day’s pay – it is unacceptable for any company to come up short.

“All employers, including those on this list, need to pay workers properly.

“This government will continue to protect workers’ rights vigilantly, and employers that short-change workers won’t get off lightly.”

Employers who pay workers less than the minimum wage have to pay back arrears of wages to the worker at current minimum wage rates. They also face hefty financial penalties of up to 200% of arrears – capped at £20,000 per worker – which are paid to the government. Since 2015 the government has ordered employers to repay over £100 million to 1 million workers.

A significant number of the minimum wage breaches identified today affected those on apprenticeships. Today the government has published new guidance to ensure employers know exactly what they need to do to pay their apprentices, and all workers, correctly.

National Minimum Wage Naming Scheme Round 17, August 2021: educational bulletin (PDF, 541KB, 7 pages)

The government is committed to protecting workers’ rights and while the vast majority of businesses follow the law and uphold workers’ rights, the publication of this list serves as a reminder to employers that the government will take action against those who fail to pay their employees the minimum wage.

As well as advice for employers, HMRC offers advice for all workers on how to ensure they are being paid correctly via the Check your pay website.

Chair of the Low Pay Commission Bryan Sanderson said: “These are very difficult times for all workers, particularly those on low pay who are often undertaking critical tasks in a variety of key sectors including care.

“The minimum wage provides a crucial level of support and compliance is essential for the benefit of both the recipients and our society as a whole.”

nmw-naming-scheme-round-17-educational-bulletinDownload

HMRC: National Minimum Wage rate reminder for summer staff

Students and seasonal staff working in Scotland are being reminded by HM Revenue and Customs (HMRC) to check that they are being paid the National Minimum Wage (NMW).

All workers are legally entitled to be paid the NMW. This includes temporary seasonal staff, who often work short-term contracts in bars, hotels, shops and warehouses over the summer.

Last year (2020-21) HMRC helped 155,000 workers across the UK to recover more than £16 million in pay which was due to them. HMRC is reminding workers to check their hourly rate of pay, and to also check any deductions or unpaid working time.

One person who has benefitted from HMRC’s enforcement of the NMW is Amber, a marketing apprentice. She was concerned that she was not being paid correctly, so contacted HMRC online. HMRC looked into Amber’s concerns and spoke with her employer. Amber was being underpaid and she received £1,900 in back pay.

The National Minimum Wage hourly rates are currently:

  • £8.91 – Age 23 or over (National Living Wage)
  • £8.36 – Age 21 to 22
  • £6.56 – Age 18 to 20
  • £4.62 – Age under 18
  • £4.30 – Apprentice.

Steve Timewell, Director Individuals and Small Business Compliance, HMRC, said: “We want to ensure that Scotland’s seasonal workers and students are being paid what they are entitled to and, as the economy reopens, help employers if they are unsure of the rules.

“Workers should check their hourly rate and look out for any deductions or unpaid working time which would reduce their pay. It could take them below the minimum wage.

“HMRC investigates every complaint made about the minimum wage, so whether you are selling sun cream, giving a hotel room a clean, or serving a strawberry smoothie, if you think you are being short-changed you should get in touch.”

Anyone not being paid what they are entitled to can complain online at https://www.gov.uk/minimum-wage-complaint.

If they want to speak with someone they should phone the Acas Pay and Work Rights Helpline on 0300 123 1100, who may transfer the call to HMRC.  

Employers can also contact the Acas Helpline for free help and advice or visit GOV.UK to find out more.

260 employers named and shamed

Foul! Falkirk, Motherwell and Morton football clubs named and shamed

The Department for Business, Energy and Industrial Strategy (BEIS) today named 260 employers for failing to pay 16,000 workers at least minimum wage rates. Government investigators identified £1.7 million in back pay for some of the UK’s lowest paid workers and fined employers £1.3 million for underpayment. Continue reading 260 employers named and shamed