News
Jessica Fino 16 Feb 2017 12:04pm

Companies named and shamed for underpaying staff

The government has named and shamed more than 350 UK firms responsible for underpaying their staff

The Department for Business, Energy and Industrial Strategy (BEIS) identified 359 businesses who underpaid 15,513 workers a total of £994,685.

The list of companies, published on its website, showed that employers in the hairdressing, hospitality and retail sectors were the most prolific offenders.

British high street retailer Debenhams featured on the list and was accused of failing to pay a total of £134,894 to 11,858 workers.

Excuses for underpaying workers included using tips to top up pay, docking workers’ wages to pay for their Christmas party and making staff pay for their uniforms out of their own salary.

Margot James, business minister, said, “Every worker in the UK is entitled to at least the national minimum or living wage and this government will ensure they get it.

“That is why we have named and shamed more than 350 employers who failed to pay the legal minimum, sending the clear message to employers that minimum wage abuses will not go unpunished.”

The government said that HMRC is currently investigating more than 1,500 cases and that employers will be named and shamed after their cases have been closed.

Over the next year, the government will spend £25.3m on minimum wage enforcement.

Clive Lewis, ICAEW head of enterprise, said, “Although the regulatory burdens placed on SME’s shoulders can be demanding, it’s vital that all businesses ensure they adhere to employment law by paying their employees the correct amount.

“Not doing so could result in a significant financial loss for small businesses, as they will be required to pay fines on top of re-payments to staff. It’s crucial that government reaches out to smaller businesses who may be in the dark about the correct procedure when it comes to NMW and NLW to prevent prosecutions and financial penalties.”

Frances O’Grady, general secretary of the Trades Union Congress (TUC), said, “This should be a wake-up call for employers who value their reputation. If you cheat your staff out of the minimum wage you will be named and shamed.

“But we also need to see prosecutions and higher fines for the most serious offenders, especially those who deliberately flout the law.

“Minimum wage dodgers must have nowhere to hide. We need to see strong unions in every workplace to stop these abuses from happening."

Employers were also named and shamed for the first time for failing to pay the National Living Wage. While the current National Minimum Wage stands at £7.20 per hour for those aged 25 and over, the recommended living wage is £7.50.

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