Tax Tip – National Minimum Wage

HMRC steps up on Naming & Shaming employers who fail to comply with the the new National Minimum Wage.

You may have heard on the radio that recently a magnitude of employers have been announced as failing to comply with the new National Minimum Wage laws. Here’s the guidance on how to avoid being one of them.

Remember, employees can report you to HMRC or ACAS if you fail to pay them the minimum.

What is the NMW?

If you are aged 25 and over, and not in your first year of an apprenticeship, you are legally entitled to at least the National Living Wage. Those under 25 and apprentices also benefit from rises in the Minimum Wage.

You can check what your minimum wage is here

The government insists there is no excuse for companies not to pay employees the wages they are entitled to, whether this is by wilfully breaking the law, or making irresponsible mistakes.

Legislation is in place in order to ensure that anyone entitled to the National Minimum Wage (NMW) should receive it. Paying anything less than National Minimum Wage is deemed unacceptable, illegal and will be punished by law.

As well as higher penalties for not paying National Minimum Wage, the government has made a decision to name and shame employers who fail to pay their workers what they are due. They are also working with HM Revenue and Customs (HMRC) to investigate non-compliance and facilitate prosecutions in the most serious of cases.

The penalty is calculated as 100% of the total underpayment for all of the workers and the Government wants to go further and bring in legislation at the earliest opportunity so that the maximum £20,000 penalty can apply to each underpaid worker.

If you have any questions or queries, please get in touch with us 01733 699033 or [email protected]

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