Employers failing to pay national minimum wage face stiffer penalties
January 18, 2007
From 1 February, employers who have been paying their staff less than the national minimum wage will have to pay arrears within seven days or face prosecution and new fines.
Currently, employers have 28 days to pay arrears. However, if an employer misses the new seven-day deadline, they will have to pay a minimum £224.70 fine per worker. If employers still fail to pay, they risk prosecution and an additional £5,000 fine.
"Workers have a right to a decent minimum wage and we’re determined they get it," said Trade and Industry Secretary Alistair Darling.
"To those employers avoiding the minimum wage the message is – don’t pay it and you’ll pay the fine," continued Darling. "In the past year, the Government’s enforcement teams helped more than 25,000 workers get more than £3 million in unpaid wages."
British Chambers of Commerce director general David Frost welcomed the new fine. "We fully support the Government’s actions in clamping down on rogue businesses that seek to undercut the minimum wage," he said.
"Firms that flout minimum-wage regulations are providing unfair competition for the vast majority of employers who do not break the law and consequently have to charge higher prices."
The hourly minimum wage rates are:
- £5.35 for employees aged 22 and above;
- £4.45 for employees aged between 18 and 21; and
- £3.30 for employees aged 16 and 17.
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