Minimum Wage: avoid the pitfalls
HMRC regularly publishes the names of employers who don’t pay correctly.
It also publishes lists of Del-Boy-style excuses for non-payment, like ‘she only makes the teas and sweeps the floors’. But this can hide the real problem – which is that many businesses named and shamed are reputable employers, who genuinely think they have complied with the law.
The government pledges ‘robust enforcement action against employers’, and with penalties of up to 200% of any underpayment, it’s expensive getting it wrong. Employers recently named and shamed included high street brands, small businesses and sole traders. Their mistakes over deductions from wages, calculating working time, and paying apprentices cost them nearly £7 million in penalties and back payments.
We look at these and other high-risk areas here.
Getting minimum wage right first time matters.
Dealing with minimum wage problems after they have happened is likely to be more expensive - because underpayments must be made good to workers at current rates, and penalties are worked out as a percentage of arrears. We can help you check compliance and flag up areas of potential risk. Please don’t hesitate to get in touch.