Penalties to increase for minimum wage underpayers
New rules will come into force next month while will leave Employers who fail to pay workers the national minimum wage facing stiffer penalties.
The maximum fine for anyone failing to pay the statutory level will increase from £5,000 to £20,000.
The minimum wage currently for 18-to-20-year-olds is £5.03 an hour, while it is £3.72 an hour for the 16-to-17-year-old age group.
In 2012, 1.4 million people were paid the minimum wage. For people aged over 21 it is £6.31 an hour; for those aged 18 to 20 it is £5.03; under 18 it is £3.72.
“Anyone entitled to the national minimum wage should receive it,” said Business Secretary Vince Cable. “Paying anything less than this is unacceptable, illegal and will be punished by law. So we are bringing in tougher financial penalties to crack down on those who do not play by the rules. The message is clear: if you break the law, you will face action.”
In the last financial year, HMRC identified 736 employers across the UK who had failed to pay the minimum wage, leading to the recovery of £3.9m in unpaid wages for more than 26,500 workers. This was down from the previous year’s figure of 968.
Employers who are found to have made underpayments of more than £20,000 to any worker after the new laws come into force will not only pay the new higher level of penalties but will face this penalty for each such worker.
Where the underpayment for any individual worker or group of workers exceeds £20,000 the penalty will be restricted to £20,000 in relation to that worker or group.