Government gives higher penalties to NMW lawbreakers
15 January 2014
Employers who fail to pay their workers the National Minimum Wage (NMW) will be hit with increased fines of up to £20k, as part of the government’s crackdown on rogue employers.
Wed, 15 Jan 2014Employers who fail to pay their workers the National Minimum Wage (NMW) will be hit with increased fines of up to £20k, as part of the government’s crackdown on rogue employers.
At the moment, employers that break NMW law must pay the unpaid wages plus a financial penalty calculated as 50% of the total underpayment for all workers found to be underpaid. The maximum penalty an employer can face is £5k.
Following an announcement by the prime minister before Christmas, the government will increase the financial penalty percentage from 50% to 100% of the unpaid wages owed to workers. The maximum penalty will increase from £5k to £20k.
According to a statement from the Department for Business Innovation and Skills (BIS), regulations introducing these new limits are subject to Parliamentary approval and are expected to be in force in February 2014.
The BIS statement says the government wants to go further and “will bring in legislation at the earliest opportunity so that the maximum £20k penalty can apply to each underpaid worker”.
Business secretary Vince Cable says: “Anyone entitled to the NMW should receive it. Paying anything less than this is unacceptable, illegal and will be punished by law. So we are bringing in tougher financial penalties to crackdown on those who do not play by the rules. The message is clear – if you break the law, you will face action.”
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At the moment, employers that break NMW law must pay the unpaid wages plus a financial penalty calculated as 50% of the total underpayment for all workers found to be underpaid. The maximum penalty an employer can face is £5k.
Following an announcement by the prime minister before Christmas, the government will increase the financial penalty percentage from 50% to 100% of the unpaid wages owed to workers. The maximum penalty will increase from £5k to £20k.
According to a statement from the Department for Business Innovation and Skills (BIS), regulations introducing these new limits are subject to Parliamentary approval and are expected to be in force in February 2014.
The BIS statement says the government wants to go further and “will bring in legislation at the earliest opportunity so that the maximum £20k penalty can apply to each underpaid worker”.
Business secretary Vince Cable says: “Anyone entitled to the NMW should receive it. Paying anything less than this is unacceptable, illegal and will be punished by law. So we are bringing in tougher financial penalties to crackdown on those who do not play by the rules. The message is clear – if you break the law, you will face action.”
• Want to comment on this story? The Comment box is at the bottom of the page. Sorry for the glitch but just scroll right down and share your opinions!
