There have been calls from campaigners to impose tougher sanctions on employers who are guilty of national minimum wage breaches, as it emerged that just £14 million in fines had been levied on those employers who had failed to pay the correct amount for the national minimum wage and the national living wage during the 2017/18 financial year.
National Minimum Wage Breaches 2017/18
During the financial year 2017/18, more than 200,000 employees were underpaid by a total of £15.6 million. However, despite this, only £14 millions in fines were imposed on those employers who were guilty of the national minimum wage breaches
Part of the reason for the low level of fines relates to the fact that some firms had already corrected the problem by the time an investigation took place. Another factor was that some of the cases had been opened on the breaches, prior to the introduction of the penalties in question in 2016.
Campaigners have called for tougher action. For example, Carys Roberts, an economist at the Institute for Public Policy Research (IPPR), stated: “To be a serious deterrent, the punishments for flouting the law must get tougher. Let’s see these companies fined properly.” Lucie Russell from the charity Barrow Cadbury Trust, added: “It’s not good enough for employers to blush and say sorry after recompensing workers; they should always pay a fair wage for a fair day’s work.“
In defence of the Government, the business minister, Kelly Tolhurst, stated: “We are dedicated to stopping underpayment of the minimum wage. Employers must recognise their responsibilities and pay their workers the money they are entitled to.“
National Living Wage
In the meantime, the Living Wage Foundation state that the level of the national living wage is £1,800 per annum below where it should be to amount to a real living wage. Tess Lanning, director of the Living Wage Foundation, stated: “For these people, this is the difference between struggling to make ends meet and being able to cover the basics: from decent meals to heating bills, to the costs of a birthday cake for their children.” The foundation estimate that the difference between the real living wage and the national living wage equates to a shortfall of 33 working days, as that would be the time required in terms of additional work to make up the difference.