Minimum Wage Compliance and 'Employment Law Evasion' in the Gig Economy
The publication of a new report on minimum wage compliance and the launch of an inquiry into 'employment law evasion' in the gig economy highlight that both of these matters remain present on the government's current agenda.
National Living Wage and Minimum Wage: Compliance and Enforcement
The Department for Business, Energy & Industrial Strategy (BEIS) has published a report on compliance and enforcement of the National Living Wage and National Minimum Wage in 2017/18. The report notes that over 2 million workers are estimated to have benefited from the most recent increase of the National Living Wage in April 2018 and confirms that the government are committed to increasing compliance with minimum wage requirements.
The report details the work being undertaken to promote compliance and identify underpayment, including highlighting the following:
- HMRC has identified £15.6 million worth of underpayments benefitting over 200,000 workers in 2017/18, this is double the number of workers identified in 2016/17
- in 2017/18 the government prioritised the Social Care, Retail, Commercial Warehousing and Gig Economy sectors for targeted enforcement
- £14 million worth of penalties have been issued to employers
- as at July 2018, 1,957 employers have been 'named and shamed' publically as having underpaid their workers
The publication of the report is a timely reminder for employers to ensure they are complaint with minimum wage legislation.
Gig Economy: Law and Enforcement Inquiry Launched
Following a number of high profile employment tribunal cases and campaigns, on the 27 September 2018 Frank Field, Work and Pensions committee chair, announced an inquiry into the extent to which tribunal judgments against employers in the gig economy are being enforced.
The inquiry follows concerns that some companies are not meeting their legal requirements with regards to recognising workers' rights including paying minimum wage and holiday pay.
Frank comments that he hopes the inquiry will: "shine a bright light on the extent to which justice is being evaded in the gig economy" and adds they will "be looking to suggest any immediate changes that are required, both to the law itself as well as its enforcement, to ensure no company is able to evade justice."
The inquiry will gather evidence from individual workers, legal experts, enforcement specialists, trade unions and companies. The evidence requested will include details of employment tribunal claims, settlements and recommendations on what, if any, reforms are required.
We will keep you updated with developments in the inquiry in due course.