Too Many Bosses Ducking Minimum Wage

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09 January 2015 | Updated 01 January 1970

A report from the TUC alleges that there are a number of employers who are deliberately avoiding paying their staff the minimum wage. The report – Enforcing the National Minimum Wage – Keeping up the Pressure – accepts that while most employers are happy to comply, a minority have developed a wide range of scams.

This includes under-recording hours, bogus self-employment, misusing interns and volunteers, charging for uniforms, not paying for travel between work sites during the working day, clocking workers off when there are no customers in the store or cafe, and employers ‘vanishing’ to avoid minimum wage fines only to reappear under another name.

The report found that apprentices are particularly likely to be underpaid, with a recent government survey suggesting that 120,000 are paid less than the relevant minimum wage rate.

“Failing to pay the minimum wage is an antisocial act that squeezes those workers who have the least,” stated Frances O’Grady, General Secretary, TUC. “There should be no hiding place for cheapskate bosses who try to cheat their workers out of the minimum wage. There should be a broad consensus between political parties, good employers and trade unions that the minimum wage must always be enforced effectively. We urge everyone to support the TUC’s plan for ensuring continuous improvement to the minimum wage system.”

The TUC plan outlines a 10-point programme of continuous improvement during the next parliament:

• Restore the budget for raising awareness about the minimum wage to £1 million.
• Hire 100 more HM Revenue and Customs (HMRC) enforcement officers.
• Better official guidance on the minimum wage so that employers know their responsibilities.
• Create legal gateways so that HMRC can share information about enforcement with local authorities and the transport regulatory authorities.
• Name and shame all non-payers.
• Government to guarantee arrears if employer goes bankrupt or simply vanishes.
• Adopt a prosecution strategy targeted towards the worst offenders and increase maximum fine from £5,000 to £75,000.
• More targeted enforcement for high-risk sectors.
• Make government funding for training apprentices dependent on employers paying the minimum wage, and create a duty for training providers to check that the minimum wage is paid.
• Promote collective bargaining so that trade unions can deal with more minimum wage problems themselves.

The TUC report also identifies 10 groups of workers who are particularly at risk of underpayment – apprentices, migrant workers, domestic workers, interns and bogus volunteers, false self-employment, zero-hours contracts including temporary agency workers, social care, workers whose accommodation is dependent on their job, seafarers, and umbrella employment schemes.

Pictured: Frances O’Grady, General Secretary, TUC. “There should be no hiding place for cheapskate bosses who try to cheat their workers out of the minimum wage”

Article written by Cathryn Ellis | Published 09 January 2015

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