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Jun 2013


Paying Less Than the Minimum Wage is Totally Unacceptable

HMRC have published news of their compliance action in 2012-13 against employers who were investigated for alleged breaches of the minimum wage rules.

In 2012-13, HMRC investigated 1,693 complaints against employers for allegedly breaching minimum wage rules. This resulted in 708 employers receiving automatic penalty charges of up to £5,000, with 51 of those employers being penalised to the maximum of £5,000.

26,519 employees received an average of approximately £150 in back pay, topping up wages that had previously been below the legal minimum rate.

Employment Minister Jo Swinson said:

"Paying less than the minimum wage is totally unacceptable. Whenever we find examples of businesses breaking the law we will crack down on them.

"Supporting fairness in the workplace is one of our key priorities and the National Minimum Wage is one way of making sure this happens. It supports as many workers as possible without damaging their employment prospects, which is why effectively enforcing the minimum wage is critically important in making sure it stays a success.

"The figures from last year show that HMRC can really help people who have been underpaid to claim back the money they are owed.”

Cases where HMRC has taken action against employers in the past year:

•             A major fashion chain was ordered to pay its 90 unpaid interns almost £60,000.

•             A multi-outlet retailer, which required employees to purchase specific items of clothing from its range, was ordered to repay almost £170,000 for more than 6,000 workers.

•             A national retailer, which required its employees to attend work before and after opening hours without pay, was ordered to pay arrears of wages of more than £193,000 for nearly 3,500 workers.

•             A recruitment agency, requiring its workers to attend training at a client's business without pay, was ordered to pay £28,000 for 300 workers.

Michelle Wyer, Assistant Director of HMRC’s National Minimum Wage team, said:

“Paying the National Minimum Wage is not a choice – it’s the law. HMRC enforces the rules, protecting workers from rogue employers, ensuring they get at least the wage to which they are legally entitled.

“Where an employer ignores these rules, we will take steps to ensure arrears are paid out in full and the employer fined. In the most serious cases, criminal prosecution can follow.”

In 2012-13,17,775 people called the Pay and Work Rights Helpline, which provides advice in more than 100 languages, for information or to report an illegal wage which lead to HMRC opening 1,408 enquiries into employers.

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