524 employers named by DBT for failure to pay National Minimum Wage
The Department for Business and Trade has named 524 employers for failure to pay the National Minimum Wage following investigations by HMRC between 2015 and 2023.
What is the National Minimum Wage?
The National Minimum Wage (NMW) is a prescribed minimum hourly rate of pay which employers must legally pay to most of their workers. There are different rates of NMW for different age-related categories of worker. The highest of these rates is called the 'National Living Wage' and currently applies to workers aged 23 or over. From 1 April 2024, the National Living Wage threshold is to be reduced to workers aged 21 or over.
Enforcement
There are several ways to enforce the NMW, including issuing civil notices of underpayment, criminal enforcement, and naming and shaming employers who fail to pay staff at the correct rate.
The Department for Business and Trade has now published the names of 524 employers that have failed to pay NMW. Between these employers, £16 million had to be repaid to over 172,000 workers, together with financial penalties of up to 200% of the underpayment.
The list is accompanied by a bulletin that identifies the following main reasons for underpayment:
- Making deductions from wages for items such as food, uniform, equipment, childcare costs and salary sacrifice schemes
- Unpaid working time, including where work is completed before the start of a shift, or where clock-in times had been rounded up
- Failure to pay the NMW correctly, including paying apprentices at the correct rate and failing to properly apply the accommodation offset
The bulletin also addresses salary sacrifice arrangements, offering a reminder that the new lower rate of pay agreed as part of such an arrangement is the relevant rate for NMW purposes.