Written by: Keith Tully
Reviewed: Wednesday 2nd September, 2015
A new team of HM Revenue & Customs (HMRC) operatives have been instructed to clamp down on companies that fail to pay their staff the National Minimum Wage.
The HMRC will see its enforcement budget beefed up in support of its efforts to tackle employers who don’t pay members of their workforce hourly amounts to which they are legally entitled, the Department for Business, Innovation and Skills (BIS) has announced.
Powers available to the HMRC’s enforcement teams on the issue will include penalties for employers, as well as prosecutions and “naming and shaming of the most exploitative employers”.
As an additional deterrent against paying below the national minimum wage, HMRC can also now consider banning company bosses found guilty of underpaying their staff from acting as company directors for a period of up to 15 years.
“There is no excuse for employers flouting minimum wage rules and these announcements will ensure those who do try and cheat staff out of pay will feel the full force of the law,” said business secretary Sajid Javid, who made the announcements on the government’s behalf.
“This one nation government is committed to making work pay and making sure hardworking people get the salary they are entitled to,” he said.
Statements issued by the BIS on the subject explain that non-compliant companies in this context will now be obliged to pay double the amount of arrears they owe unless they settle payments within 14 days.
The maximum penalty that any employer could potentially need to pay as fines is £20,000 per employee, a figure that hasn’t been changed.
The government has also said it will soon install a new director of labour market enforcement and exploitation to oversee the ways in which these issues are investigated and tackled throughout the UK.
Additionally, there is to be a consultation later in 2015 on the subject of whether or not a new criminal offence described as an “aggravated breach of labour market legislation” ought to be introduced across the country.
The government has also said it will be aiming to improve the guidance and support made available to companies when it comes to payroll issues and all matters relating to minimum wage compliance.