A quarter of the 1,693 minimum wage complaints investigated in FY2012/13 by HM Revenue & Customs (HMRC) involved apprentices, the organisation tells Recruiter.

Yesterday (16 April), business secretary Vince Cable expressed concern over “evidence that a significant number of employers are not paying apprentices the relevant minimum wage rate”, in announcing a rise to the national minimum wage (NMW).

This includes an extra 3p to the apprenticeship rate, making it £2.68/hour. This rate applies to apprentices under 19, or those aged 19 or over and in the first year of their apprenticeship – after which higher rates based on age apply.

A report from independent body the Low Pay Commission (LPC) finds that 27% of apprentices, up from 24% last year, were underpaid.

Of apprentices aged 18-20, 42% were paid less than their minimum entitlement. An 18-20-year-old in the second year of their apprenticeship is eligible for £5.03 an hour. A quarter of apprentices across this age group were paid under £2.65 an hour.

An HMRC spokesperson tells Recruiter: “Where an employer is found to have abused the minimum wage rules, they are required to pay the arrears of wages back at current rates and a financial penalty. Where the failure to pay is deliberate, employers risk being named and could be prosecuted.”

A spokesperson for the Department for Business Innovation and Skills (BIS), which sets minimum wage rates, tells Recruiter that “most employers want to do the right thing”, and that in many cases it is “an awareness issue” that means apprentices are underpaid.

Apprenticeship training providers expressed surprise at the LPC findings. A spokesperson for City Gateway, which has been involved in a high-profile awareness campaign with newspaper the London Evening Standard, tells Recruiter the issue is “not something thankfully we’ve dealt with”.

A lot of the employers City Gateway works with pay above the minimum rate for apprentices, often up to the London living wage of £8.55 an hour, the spokesperson adds.

At Network Rail, a major employer of apprentices, first year recruits are paid £8.4k, plus £1.15k on completion of the year, rising to £11.75k and £14k in subsequent years. For the first year this includes free benefits of three meals a day, accommodation and other benefits such as safety boots. After holiday entitlement of 28 days and eight days bank holiday, £8.4k/annum works out at £4.86/hour based on eight-hour days.

• Network Rail, the winner of the Best Apprentice/School Leaver Recruitment Strategy at last year's Recruiter Awards, is also nominated in the same category this year for the 2013 event, sponsored by Eploy.