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Government kicks off 2021 with “naming and shaming” of Minimum Wage offenders

7th January 2021

First and foremost, may we wish you a Happy New Year from everyone at Ansons Solicitors.

The start of the New Year is often a time for reflection and future planning, positivity and drive.  For many however, the start of this year has not been quite so optimistic; not least with the Government using New Year’s Eve as the appropriate time to “name and shame” those employers who flaunted the National Minimum Wage regulations.  A full list containing some 139 names has been published on the Government website for all to see and which can be accessed via the link below:

https://www.gov.uk/government/news/rogue-employers-named-and-shamed-for-failing-to-pay-minimum-wage

It comes as the Government seeks to take tougher measures on enforcement of minimum wage, which, notwithstanding the current economic climate, is due to increase again in April 2021.

Somewhat surprisingly, the list contains some large household names who will be known to all, and who may have been expected to have known better and acted more appropriately.  In total, those named and shamed represent over £6.7 million in underpayments to workers, ranging from very significant sums across many workers to about £510 to a single person.

The common issues leading to minimum wage breaches were:

  • The minimum weekly wage had been incorrectly calculated and, once recalculated including the correct deductions fell below the acceptable level; and
  • Failure to account for either:
    • an anniversary which would have put a worker up into a higher category, i.e. they turned 18, 21, or 25 years of Age.
    • an increase in the national minimum wage at the relevant times.

In practice, such a breach would mean that those employers caught underpaying the minimum wage will be faced with:

  1. Being ordered to pay to each individual the deficit between the minimum wage and the sum already paid;
  2. A fine of up to 200% of the value of the underpayment, capped at £10,000 per affected employee; and
  3. The embarrassment of being “named and shamed” on the Government list. This will no doubt affect business’ reputation and standing, and may see shareholders asking some rather difficult questions.  It will also likely mean that they risk facing greater scrutiny in the future both internally and externally.

If you would like to discuss any concerns regarding underpayment of minimum wage and/or how your business might best face the threat of risks associated with and arising out of the National Minimum Wage legislation, please speak to Jason Alcock, an experienced employment law solicitor, in our dispute resolution team on 01543 267 196 or email him at jalcock@ansonssolicitors.com

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