Employers who fail to pay their workers the National Minimum Wage (NMW) will face a fine of £20,000 in comparison to the previous fine of £5,000. This new limit is expected to come into force in February 2014. There is also talk of the government introducing legislation so that the maximum £20,000 penalty can apply to each underpaid worker.
At the moment, the penalty is calculated as 50% of the total underpayment for all workers specified in the Notice of Underpayment issued to employers by HMRC. The minimum is £100 and the maximum is £5,000. The penalty is reduced by 50% if the unpaid wages are paid within fourteen days. At the moment, it is not clear whether the fine will still be reduced if paid within fourteen days under the new scheme.
Hopefully the increased fine will deter employers who are tempted to pay less than the NMW.
If you believe that you are paid less than the minimum wage or have any queries regarding this or any other employment matter, please contact the employment team at Newcastle Solicitors Beecham Peacock LLP on 0191 2323048.