Failure to pay minimum wage costs firms

Businesses that failed to pay staff the national minimum wage have been forced to pay back more than £2 million in unpaid salary.

In addition to paying workers back money they owed, 233 employers on the government's 'named and shamed' list were fined £1.9 million.

The national living wage is currently £7.50 an hour for employees over the age of 25, and £7.05 an hour for those aged between 21 and 24.

The Department for Business, Energy and Industrial Strategy said retail, hairdressing and hospitality businesses were among the worst offenders.

Common errors made by businesses include:

  • deducting money from salary to pay for uniforms
  • failure to account for overtime hours
  • wrongly paying apprentice rates (£3.50 an hour for under-19s or those in their first year) to workers.

Margot James, business minister, 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."

Melissa Tatton, director at HMRC, added:

"HMRC is committed to getting money back into the pockets of underpaid workers, and continues to crack down on employers who ignore the law.

"Those not paying workers the National Minimum or Living Wage can expect to face the consequences."

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