Issue date
26 Apr 2019

Commenting on the publication today (Friday) of a report by the Low Pay Commission showing non-compliance on the minimum wage is on the rise, TUC General Secretary Frances O’Grady said:

“Every worker deserves fair pay for their work. There can be no exceptions to the minimum wage.

“And there should be no hiding place for bad employers – that’s why the government must restart naming and shaming bad bosses who cheat their workers out of pay.“

Editors note

- For the full Low Pay Commission release click here: https://www.gov.uk/government/news/minimum-wage-underpayment-on-the-rise-low-pay-commission-finds?utm_source=e17a13b5-7db3-4f51-8f3b-d6a3f05852eb&utm_medium=email&utm_campaign=govuk-notifications&utm_content=daily

- The TUC’s recommendations for improving National Minimum Wage awareness and enforcement 2018-19 are:

  • The government should continue to increase funding for promotion and enforcement. Previous increases are starting to bear results in terms of better enforcement, but the continued increase in the number of workers covered and the greater incentive for non-compliance that stems from higher rates both warrant more funding.
  • BEIS should work with the social partners to develop tailored guidance for atypical sectors.
  • Action is needed to ensure that all employers know that they have a duty to keep proper records to show that the NMW is being paid, and that employers follow the law in this area.
  • The civil penalty regime provides a fairly strong financial incentive for employers to avoid underpayment, but this is still not enough on its own. Prosecutions for NMW offences should be made a higher priority, so that the number increases to around a dozen per year. The maximum fine for NMW offences should be increased from £5,000 to £75,000 and sentencing guidelines should reflect the seriousness of these offences.
  • Government should quickly end the moratorium on naming and shaming employers caught underpaying
  • Government should act as a guarantor of last resort for the NMW in cases of redundancy or employers absconding.
  • There should be a greater focus on enforcing the NMW in cases where employers use false employment status.
  • It should be made clear that individuals undertaking “trail shifts” involving productive work always qualify for the NMW and the guidance should be actively enforced.
  • HMRC cannot feedback on third party complaints, which creates a disincentive to feed in information about underpayment. A workable protocol on third party complaints should be established. This should be formulated and promoted in a way that encourage those with information about underpayment, including trade unions, to bring it forward. 
  • The LPC should remind the government of its duty to fund social care and other public services at a level that always enables to the NMW to be paid. There should be a greater effort by government, local authorities and the Care Quality Commission to ensure that the National Minimum Wage is always paid.
  • The National Minimum Wage should clearly apply to workers undertaking sleep-ins. The government should stand ready to defend this position if it is challenged.
  • HMRC should target the social care sector for enforcement  
  • The LPC should call on government to implement the finding of the DFT-led working group, which recommends extending the NMW to ships engaged solely in UK port to port journeys. The Commission should monitor implementation.
  • The LPC should review how apprentices are advised of their rights and how they are enforced.  HMRC should both remind employers of their duties and undertake some targeted enforcement work in this area, focusing on the low paying sectors. HMRC compliance officers should record the number of apprentices underpaid that they discover during compliance investigations.