The Government has announced new measures to toughen up the enforcement of the national minimum wage (NMW) by making it easier to name and shame employers who do not comply.
Under the original scheme, employers had to meet one of seven criteria before they could be named, including the provision of evidence:
- that the employer knowingly or deliberately failed to comply with their NMW obligations,
- that the employer has previously received advice from HMRC about the steps they need to take to ensure future compliance with national minimum wage and has not taken those steps, and
- that the employer has failed to take adequate steps to keep or preserve NMW records.
In addition, the minimum amount of national minimum wage owed to workers had to be at least £2,000 and the average per worker at least £500 before an employer could be referred to the Department for Business, Innovation & Skills (BIS) from HM Revenue & Customs (HMRC) for naming.
In 2012 to 2013 HMRC identified 736 employers who had failed to pay the national minimum wage, leading to the recovery of £3.9 million in unpaid wages for over 26,500 workers.
The revised NMW naming scheme, which will come into effect in October 2013, will strip back restrictions, making it simpler for government to name more employers who break the law.
“Paying less than the minimum wage is illegal. If employers break this law they need to know that we will take tough action,” said Employment Relations Minister Jo Swinson.
“This is why I’m making changes so it is easier to name and shame employers who break the law. This gives a clear warning to rogue employers who ignore the rules, that they will face reputational consequences as well as a fine if they don’t pay the minimum wage.”
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