With both the National Living Wage and the National Minimum Wage due to be increased from April 2020, HMRC have confirmed that they will continue to publically name and shame employers who fail to pay the base line wages to their employees.
Why are the government naming and shaming employers?
The National Living Wage (NLW) and the National Minimum Wage (NMW) are set with the intention of ensuring workers are able to earn enough money to live on.
To help protect employees from being exploited, the government adopted a scheme of naming those employers who they found to be paying staff less than the guideline wages.
What are the changes to the NLW and NMW?
Payable to staff aged 25 and over, the National Living Wage increases on the 1st April, moving from the current rate of £8.21 per hour, to £8.72 per hour.
The rates for National Minimum Wage depend on the employee’s age, though they must be at least school leaving age.
What is being done to punish underpaying employers?
In addition to publicly naming employers found underpaying their staff, the government is also adopting a strict approach to the employer’s arrears. That is, the wages that employees should have received, but didn’t.
Under HMRC’s new approach, employers will be required to repay the difference to their employees. They can also expect to be handed a fine of up to 200% of the value of the arrears. It puts a lot more pressure on employers to be ethical in the way that they treat staff.
We provide payroll services in addition to our accountancy packages. Learn more about what we can do to help you out with payroll.
Want to learn more?
Subscribe to our newsletter to get accounting tips like this right to your inbox
About The Author
A content writer specialising in business, finance, software, and beyond. I'm a wordsmith with a penchant for puns and making complex subjects accessible. Learn more about Elizabeth.