Failure to pay minimum wage – a rising problem

Employee underpayment is rising and businesses are not being sufficiently pursued, according to Living Wage campaigners, the Resolution Foundation.

It is stated that minimum wage non-compliance fell consistently between 1999 and 2015. However, since the introduction of the National Living Wage (NLW) in 2016, non-compliance has been increasing. In 2016 around one in five workers aged 25 and over earning the NLW were reportedly underpaid. In 2019 this figure rose to more than one in four workers.

However, HMRC has claimed that they are prosecuting more non-compliant companies, identifying a record 1,456 organisations between 2018 and 2019. HMRC is also issuing higher fines, charging a record £14.1 million in penalties between 2017 and 2018.

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