Companies named and shamed for flouting minimum wage laws

News Article

The latest list of UK employers who have failed to pay their workers the national minimum wage, has been published, revealing that a record number of fines, totalling £1.9 million, has been handed down.

In addition to the fines, employers will need to pay more than 13,000 employees around £2 million in back pay.

The review, which has named and shamed 233 employers who have failed to pay staff their full wages.

High Street catalogue retailer Argos has emerged as the worst offender. The company, which was bought by supermarket giant Sainsbury’s last year, had failed to pay 12,176 workers the correct amount, with a shortfall close to £1.5 million.

The error was linked to staff briefings which were conducted before they had clocked on to their shifts as well as security searches after workers had clocked off. The company has confirmed that all staff have now received their back pay.

John Rogers, CEO of Sainsbury’s Argos, said: “Shortly after we (Sainsbury’s) acquired the Argos business last year it was brought to my attention that, as part of a routine visit, HMRC had uncovered an issue with some Argos store systems and processes, which meant that some colleagues had been paid below the national living wage.

“Sainsbury’s prides itself on being a trusted brand where people love to work and I was, therefore, very disappointed to hear this and launched an immediate investigation.

“I am pleased to say the issue was resolved quickly and processes have been updated to ensure this cannot happen again.”

Business minister Margot James said: “It is against the law to pay workers less than legal minimum wage rates, short-changing ordinary working people and undercutting honest employers.

“Today’s naming round identifies a record £2 million of back pay for workers and sends the clear message to employers that the Government will come down hard on those who break the law.

“Common errors made by employers in this round included deducting money from pay packets to pay for uniforms, failure to account for overtime hours, and wrongly paying apprentice rates to workers.”

To date, the Government has fined 1,200 employers around £4 million and forced them to pay out £6 million to staff since 2013.

Lara Murray, an Associate Solicitor and employment law expert with Palmers, said: “In the past there was a tendency to assume that employers who failed to pay minimum wages, were smaller businesses who were under-resourced in terms of HR and perhaps were ignorant of the laws.

“This latest review shows that the practice is far more widespread than many may have believed. HMRC are becoming ever more litigious and employers should be left in no doubt that they will take action if they found to be underpaying their staff.”

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