Top Tips: Avoiding National Minimum Wage Naming & Shaming

2021 started with a new round of naming and shaming for businesses who failed to pay their staff the national minimum wage. Now, a further 191 firms have been singled out, some of which were household names. Overall, 34,000 workers will receive a total of £2.1m after their employers broke national minimum wage laws.

Prior to 2020, the last round of government naming and shaming was in 2018, after which it was paused. Now, the scheme seems to be back in full swing, with more offenders being targeted.

To ensure you’re not one of these employers, and are paying your employees correctly, follow these five top tips:

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Avoiding National Minimum Wage Naming & Shaming

1. Be aware of dates, age of your workers and length of service. Rates increase every April and apply to everyone who earns the minimum wage, or just above. However, workers must also receive the appropriate increase when they reach a different age band. In addition, apprentice pay changes according to length of service.

2. Know who is eligible – Zero hours workers, foreign nationals, college students helping out at weekends and senior citizens are all eligible for NMW. The number of hours worked per week makes no difference – someone who does 2 hours of cleaning a week must get NMW.

3. Understand the impact of wage deductions. Employers have recently been caught out when deducting wages from workers to pay for their uniforms. Where this deduction takes pay below the NMW, employers are breaking the law. Some deductions, like tax and NI, are treated differently.

4. Be clear on what time is ‘working time’. Time spent travelling is working time in some situations, so will attract NMW. There has been debate recently on whether workers are entitled to the NMW during sleep-in night shifts, the final ruling says that sleep-in care workers are only entitled to the NMW when they are awake on shift.

5. Keep an eye on overtime – Not properly recording all hours worked may mean that the odd hour of overtime slips through your net and results in average pay for every hour worked by the worker falling below NMW.

Expert Support

If you need assistance with any of the issues raised in this infographic, or any other pay & benefits issue, please call 01455 858 132.