In light of the government naming and shaming hundreds of organisations failing to pay the National Minimum Wage, Paul Holcroft, Croner Head of Legal and Advisory, is urging employers to be more diligent than ever.

360 businesses were exposed for not paying their staff either the National Minimum Wage (NMW) or the National Living Wage (NLW). Renowned retailers were among the listed organisations, with the ‘biggest offenders’ in the hairdressing, hospitality and retail sectors.

Excuses used by businesses for not paying the full basic wage included using tips to top up their pay, making reductions to pay for a Christmas party, or making staff pay for their own uniforms.

“Not paying a worker the respective National Minimum Wage is illegal,” emphasises Paul. “Even with the substantial fines being imposed on these 360 businesses, plus the damage to their reputation, some are arguing that this does not serve as enough of a deterrent, and are calling for higher fines and prosecutions.

“We work on a daily basis with many businesses across a range of sectors, each with a varying knowledge-range. Many employers we speak to are also within ‘worst offenders’ sectors.  Not all knowingly underpay their employees, however for those that do, it should be a real wake up call for them, and a kick, if one is needed, to ensure that wages being paid to staff are lawful.

“This is not the last we hear of the matter. The Government is already looking at making further examples of employers who aren’t meeting legal obligations regarding pay. I urge any employers concerned by the NLW or NMW to get in touch with our Employment Law Advisors to talk through any questions or doubts they may have.”

April 2017 has seen an increase to the National Minimum Wage and National Living Wage, as highlighted in the Autumn Statement. Because of this, Paul Holcroft accentuates the importance of getting the wages correct so as to not suffer any significant implications.

“It’s imperative that employers take reign of the situation now and especially after the recent increase in April to avoid any naming and shaming, not to mention a potential financial blow.”

The following table outlines the historic minimum rates, and the increase as of April 2017.

Year 25 and over 21 to 24 18 to 20 Under 18 Apprentice
October 2016 £7.20 £6.95 £5.55 £4.00 £3.40
April 2017 £7.50 £7.05 £5.60 £4.05 £3.50

 

For any advice on the National Minimum Wage or National Living Wage, please contact us or call 0808 145 3383.