National minimum wage back payments hit £15.6m

The number of national minimum wage (NMW) underpayments has hit a record 200,000 workers in the past year, more than double the previous year’s total

In 2017/18, HMRC investigators identified £15.6m in pay owed for 200,000 workers, up from £10.9m for over 98,000 workers.

The launch of an HMRC online complaints service in January 2017 contributed to the 132% increase in the number of complaints received over the last year and the amount of money HMRC has been able to recoup.

The figures are published as the government launches its annual advertising campaign designed to encourage workers to take action if they are not receiving the national living wage (NLW) or NMW. The online campaign, which runs over the summer, urges underpaid workers to proactively complain by completing an HMRC online form.

HMRC says the online service is a quick and easy way for anyone with concerns about not being paid the NMW to report an employer or former employer anonymously. Industries most complained about to HMRC include restaurants, bars, hotels and hairdressing.

Business minister Andrew Griffiths said: ‘Employers abusing the system and paying under the legal minimum are breaking the law. Short changing workers is a red line for this government and employers who cross the line will be identified by HMRC and forced to pay back every penny and could be hit with fines of up to 200% of wages owed.

‘I would urge all workers, if you think you might be being underpaid then you should check your pay and call Acas on 0300 123 1100 for free and confidential advice.’

Bill Longe, RSM’s head of employer solutions, said the latest results suggested that workers found to have been paid under the national minimum wage can expect to be refunded an average of £78 each.

‘Bearing in mind some of these breaches will cover several years it would seem most errors identified by HMRC, although welcome and important to the individuals concerned, are fairly minor in nature.

‘Whilst HMRC is to be applauded for its efforts in helping to ensure workers are paid the wages they are legally entitled to receive, it is evident most employers are taking their responsibilities very seriously indeed.

‘Admittedly, there will always be a few bad apples seeking to flout the law but the vast majority of employers are not making deliberate errors and are being caught out by the complexity of the rules.

‘Looking to the future we would urge HMRC to work with employers to introduce clearer rules and guidance so that the amounts underpaid to employees continues to fall,’ Longe said.

Accountancy Daily