Failure to pay their workers the national minimum wage has cost employers targeted by HM Revenue & Customs (HMRC) £4 million. In accountancy terms, this has caused a real issue for those employers who have fallen foul of the rules.
HMRC secured an average of £300 in back pay for 26,519 employees, topping up wages that had previously been below the legal minimum rate, in the 2012-13 financial year.
A total of 1,693 complaints were made against employers over minimum wage rules over the 12-month period, with 708 employers receiving automatic penalty charges of up to £5,000.
Cases where HMRC took action against employers in the past year included:
- a major fashion chain that was ordered to pay its 90 unpaid interns almost £60,000
- a national retailer, which required its employees to attend work before and after opening hours without pay, was ordered to pay arrears of wages of more than £193,000 for nearly 3,500 workers.
- a recruitment agency that required workers to attend training at a client’s business without pay was ordered to pay £28,000 for 300 workers.
Michelle Wyer, assistant director of HMRC’s national minimum wage team, said: “Paying the national minimum wage is not a choice – it’s the law. Where an employer ignores these rules, we will take steps to ensure arrears are paid out in full and the employer fined. In the most serious cases, criminal prosecution can follow.
The National Minimum Wage is £6.19 an hour for workers aged 21 and over. This will increase to £6.31 an hour from 1 October 2013.