HMRC gets tough about the National Minimum Wage

By:  Lisa Kennery

From www.acas.org.uk

Hundreds of companies have been fined and ordered to make compensation payments by HM Revenue and Customs (HMRC) for failing to comply with minimum wage laws.

20130801 National Minimum Wage

More than 26,000 workers have been paid back a total of £4m, while 708 employers have been fined with 51 of them receiving the maximum penalty of £5,000. This comes after HMRC reviewed 1,693 complaints over the last year.

In one instance, a national retailer was forced to make back payments of £193,000 for almost 3,500 workers after it required them to be at work before and after opening hours without pay. Another retailer had to repay nearly £170,000 after it had its workers buy specific clothing items from its range.

Other employers were ordered to pay wages to unpaid interns who should have qualified for the National Minimum Wage (NMW) – currently at £6.19 per hour for workers aged 21 and over.

HMRC has the right to investigate employers and ask to see payment records. It’s up to employers to make sure they have payroll records proving they are paying the minimum wage. Records should be kept for at least three years.

It’s a criminal offence to refuse to pay the NMW or fail to keep NMW records, and the most serious cases can be heard in a Crown Court, meaning that there’s a potential for an unlimited fine.

National Minimum Wage rates

From www.gov.uk

The National Minimum Wage rate per hour depends on your age and whether you’re an apprentice – you must be at least school leaving age to get it.

Year

21 and over

18 to 20

Under 18

Apprentice*

2013 (from 1 October) £6.31 £5.03 £3.72 £2.68
2012 (current rate) £6.19 £4.98 £3.68 £2.65
2011 £6.08 £4.98 £3.68 £2.60
2010 £5.93 £4.92 £3.64 £2.50

*This rate is for apprentices under 19 or those in their first year. If you’re 19 or over and past your first year you get the rate that applies to your age.

The age groups were different before 2010. There were no National Minimum Wage rates for apprentices.

Year

22 and over

18 to 21

Under 18

2009 £5.80 £4.83 £3.57
2008 £5.73 £4.77 £3.53
2007 £5.52 £4.60 £3.40
2006 £5.35 £4.45 £3.30
2005 £5.05 £4.25 £3.00

Read the information on who is entitled to the minimum wage or use the National Minimum Wage calculator to check whether the National Minimum Wage is being paid.