More than 600 employers have been fined £14m in total for underpaying about 200,000 workers as a result of the HMRC crackdown on minimum wage shortfalls.

 

This is double the number of underpaid workers identified in 2016/2017, and the highest recorded number and the highest employer repayment since the National Minimum Wage came into force in 1999. 

 

This increase comes after HMRC increased its effort to promote compliance and improve employer awareness. 

 

When underpaying is discovered, the employers are instructed to repay the missing money and the government enforces this. 

 

Business Minister Kelly Tolhurst said: “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.

 

“The UK’s lowest paid workers have had the fastest wage growth in 20 years thanks to the National Living Wage and today’s figures serve as a reminder to all employers to check they are getting their workers’ pay right.”

 

This year, the following sectors have been as target as the most likely to be underpaying their workers: social care, retail, commercial warehousing and gig economy, employment agencies, apprentices and migrant workers.

 

Penny Ciniewicz, HMRC Director General of Customer Compliance, said: “HMRC is committed to ensuring that workers receive the wages they are legally entitled to, irrespective of their employer’s size or business sector, and today’s figures highlight our success over the last year.

 

“If anyone thinks they are not receiving at least the minimum wage, they can contact the Acas helpline on 0300 123 1100 in confidence or submit a query online through our complaints form.”

 

 

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There are many reasons why companies might accidentally underpay workers, from salary sacrifice with uniforms and Christmas parties to leaving employees to top up their pay with tips, and not realising that apprentice wages go up after their first year. However, one that came up a lot was administrative shortcomings in the payroll process.

 

The prime example of this is Lush. Read about why it needed to pay 5,000 employees back $2m here. In short, it was using an out of date manual pay system which couldn’t deal with the more complicated rules that the Australian government introduced, such as overtime rates. 

 

At Time and Attendance Midlands, our flagship software WinTA.NET is more than capable of handling unusual ways of paying staff and keeping within the law. 

 

From simple determination of overtime by the number of daily hours worked to the more complex payment of overtime hours adjusted when periodic targets are not met, WinTA.NET can supply working rules and patterns to calculate the correct result.

 

 

A number of basic rules control how hours are calculated. These include settings to separate “worked time” into:

 

• Different overtime rates.

• Night shift working.

• Inserting unpaid breaks when employees do not clock them.

 

You can also insert breaks either between set times, and/or after a minimum number of hours have been worked.

 

 

The shifts option can be configured for fixed time or flexitime working for each employee, showing the actual and expected hours used to calculate employee’s flexitime balances. Administrators can specify the hours used and users can view their current flexitime balance and request adjustments. Flexi adjustments can be made for any day, either to change the existing balance or to replace it with a new value. Flexitime details can be listed for one or more employees for single or multiple days.