National Minimum Wage concerns

A decision by many employers not to top up furlough pay has contributed to 2,043,000 employees being paid less than the national minimum wage (NMW), according to the Office for National Statistics (ONS).

This number is the highest on record since the NMW came into force in 1999 and is a five-fold rise on the 409,000 workers who were paid less than the NMW in 2019.

Even after excluding those employees furloughed at reduced rates of pay, the ONS found the number of people paid less than the NMW had soared to 752,000 in the space of a year. This also meant more than a million workers received less than the NMW as a result of their employer not topping up the minimum 80% rate they were entitled to while furloughed.

It is thought that up to half of all furloughed employees did not have pay topped up by employers beyond the 80% provided by the scheme and jobs with the lowest hourly rate were more than five times more likely than other roles to be furloughed with reduced pay.

The ONS report also found the lowest-paid workers were more than 20 times more likely to be furloughed on reduced pay than the highest earners, with 51.7% of those paid less than £8.72 per hour furloughed with a pay cut, compared to just 2.5% of those earning more than £29.67 per hour.

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