On 9 March, the government named and shamed 179 employers for underpaying more than 9,000 minimum-wage employees by £1.1m. As well as recovering back pay, the government also fined these employers a total of £1.3m. Retailers, hospitality, and hairdressers were the main offending sectors. The government listed Wagamama, Marriott Hotels, and TGI Friday as the top three worst offenders.
This is the tip of the iceberg. The Low Pay Commission Report 2017 estimates that as many as one in five low-paid workers are paid less than the legal minimum wage. Bryan Sanderson, Chairman of the Low Pay Commission (LPC), said:
As the National Living Wage and National Minimum Wage rates rise on 1 April, it is vital that workers understand their rights, and employers their obligations.
On 1 April, the National Living Wage will go up from £7.50 to £7.83 per hour. The Department for Business, Energy and Industrial Strategy (DBEIS) will launch a campaign before the end of March to raise awareness of the new rates and encourage employees to speak to their employer if they think they are being underpaid.
Her Majesty’s Revenue and Customs (HMRC) is the enforcer of minimum wage law. Employers who pay staff less than the minimum wage have to pay back arrears to the worker. They can be fined up to 200% of arrears, capped at £20,000 per worker. Complaints to HMRC about underpayment doubled in 2017 to 5,053. According to a DBEIS report on compliance and enforcement, published in July 2017, HMRC investigated more than 2,600 businesses and discovered [pdf, p4] £11m of underpaid wages for 98,000 workers. Last year, the Director of Labour Market Enforcement David Metcalf called for better enforcement and higher fines for violators. Despite this, the total amount of fines imposed in 2016-17 was under £4m, much less than the £11m of wage arrears identified by HMRC.
Rebecca Long-Bailey MP, Labour’s shadow business secretary, called the underpayment of staff “deplorable”. She said the government is “failing to crack down on businesses that are breaking the law”, and added that Labour would bring in a “Real Living Wage” of £10 an hour.
Featured image via Pexels
We need your help to keep speaking the truth
Every story that you have come to us with; each injustice you have asked us to investigate; every campaign we have fought; each of your unheard voices we amplified; we do this for you. We are making a difference on your behalf.
Our fight is your fight. You’ve supported our collective struggle every time you gave us a like; and every time you shared our work across social media. Now we need you to support us with a monthly donation.
We have published nearly 2,000 articles and over 50 films in 2021. And we want to do this and more in 2022 but we don’t have enough money to go on at this pace. So, if you value our work and want us to continue then please join us and be part of The Canary family.
In return, you get:
* Advert free reading experience
* Quarterly group video call with the Editor-in-Chief
* Behind the scenes monthly e-newsletter
* 20% discount in our shop
Almost all of our spending goes to the people who make The Canary’s content. So your contribution directly supports our writers and enables us to continue to do what we do: speaking truth, powered by you. We have weathered many attempts to shut us down and silence our vital opposition to an increasingly fascist government and right-wing mainstream media.
With your help we can continue:
* Holding political and state power to account
* Advocating for the people the system marginalises
* Being a media outlet that upholds the highest standards
* Campaigning on the issues others won’t
* Putting your lives central to everything we do
We are a drop of truth in an ocean of deceit. But we can’t do this without your support. So please, can you help us continue the fight?