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5 Feb, 2016 11:20

Named & shamed: 92 rogue firms fail to pay minimum wage

Named & shamed: 92 rogue firms fail to pay minimum wage

Ninety-two firms have been named and shamed for failing to pay the national minimum wage. The offending companies, which span the sectors of hospitality, social care and security services, owe employees more than £1.8 million in arrears.

The policy of naming and shaming employers was revised in October 2013, making it easier for state officials to identify firms that do not adhere to minimum wage rules. 

Since the government introduced the scheme, almost 500 employers have been penalized. According to official figures, they allowed arrears of £3 million (US$4.35 million) to build up and were consequently hit by penalties of more than £1.1 million.

Each of the 92 offending firms named on Friday had been investigated by Her Majesty’s Revenue and Customs (HMRC).

Business Minister Nick Boles said the government is determined to ensure that all those who are entitled to the national minimum wage get it.

“There is no excuse for not paying staff the wages they’re entitled to,” he said.

“Our policy of naming and shaming employers who ignore the law means there are consequences for their reputation as well as their wallets.”

Boles said the government plans to introduce a new National Living Wage that will result in a pay rise of more than £900 a year for full time workers who are on the minimum wage. He said the government will enforce this policy robustly.

Top offenders included Total Security Services Limited, which failed to pay 2,519 employees more than £1.7 million, and the Abbey House Hotel, which neglected to pay 13 members of staff a total of £13,468.47. The full list of rogue firms has been published on the government’s official website.

On October 1, 2015, the national minimum wage increased to £6.70 per hour. However, many employers failed to pay their staff accordingly.

Employers are required to pay apprentices £3.30 per hour, minors £3.87 per hour, 18-20 year olds £5.30 per hour, and those aged over 21 the top rate of £6.70 per hour. The government warns that all employers have a duty to make themselves aware of these variations, which are dependent on workers’ circumstances.

Employers who are accused of failing to adhere to the government’s minimum wage rules are given 38 days to appeal to HMRC. If their appeal is unsuccessful or not lodged, the Department for Business, Innovation and Skills (BIS) considers them for naming and shaming. Trades Union Congress (TUC) General Secretary Francis O’Grady welcomed the government’s decision to publicize the offending firms.

“Today’s list contains many well-known household names and the level of underpayment in some cases is truly eye-watering,” she said.

“Now is not the time for complacency, however. We know that thousands more rogue employers are cheating their staff and getting away with it. It is essential that HMRC catches up with them too.

“Bosses who try to duck the minimum wage must have nowhere to hide. Strong unions are needed in every workplace to stop these abuses from happening.”