New campaign to raise awareness of minimum wage obligations

News Article

Some of the least convincing excuses offered by businesses who failed to pay the minimum wage have been made public by HM Revenue & Customs (HMRC).

One employer had suggested that a member of staff wasn’t good enough to be paid the wages required by law, while another tried to argue that workers needed to “prove their worth” before they could qualify.

HMRC also investigated the case of a company which believed it was acceptable to pay foreign staff less than the statutory rate and a business where the boss felt a woman didn’t deserve the minimum wage because she “only makes the teas and sweeps the floors.”

The excuses were published by the tax authority this month, as part of a new awareness campaign about minimum wage legislation. Officials are warning those employers who break the law that they risk substantial penalties.

Business Minister, Margot James, said: “There are no excuses for underpaying staff what they are legally entitled to.”

All workers must be paid at least £7.20 an hour (National Living Wage) if they are aged 25 or over. There are also statutory National Minimum Wage (NMW) levels for groups who are not yet eligible for the Living Wage, such as school leavers, apprentices and 21-24-year-olds.

Lara Murray, an Associate and employment law expert with Palmers, said: “Employers need to be aware that there is no excuse for failing to pay the minimum wages and they are breaking the law by ignoring the statutory tariffs.

“A breach of these rules could result in a hefty fine of up to £20,000 for employers, so in the long run, far from saving money, it could result in a company suffering a much bigger financial hit.

“Additionally, a failure to pay the National Living Wage could also result in a company director being banned for up to 15 years.”

For help and advice on all aspects of employment law, please contact us.