Breaking News: National Minimum Wage update

06 July 2018

The latest list of National Minimum Wage (NMW) breaches was published on Friday 6th July by the Department for Business, Energy and Industrial Strategy (BEIS). It includes nearly 240 employers with total arrears of £1.44m and record fines of £1.97m. The increase in these figures reflects HMRC’s investment in its NMW enforcement activity over the past 18 months.

HMRC has also published a number of webinars for employers encouraging self-review and giving some basic information on key steps as part of this review and key areas of possible NMW failures. We welcome these educational webinars as a basic step in helping employers better understand their obligations under NMW – something that we have been requesting from BEIS and HMRC to help employers for some time.

We would also echo the recommendation that all employers undertake a self-review to ensure they are paying at least NMW to all workers. The NMW regulations are incredibly complex and in our experience most employers are being caught out for technical breaches which they didn’t realise impacted on NMW. Undertaking a self-review can ensure that risk areas are identified, any arrears payments if necessary can be made and ensure that processes are correct going forward to prevent future risk. Doing a self-review could mean that as a business you avoid penalties (which can be up to 200%) as well as potential reputational damage.

In its webinars HMRC also mentions a new Voluntary Disclosure Scheme. While this scheme is not open to all, it offers some employers the opportunity to notify HMRC of failures that they have identified as part of a self-review once payments have been made to workers and former workers. HMRC points out that informing them is “optional”. We recommend that employers who are considering this facility take advice before approaching HMRC.

In light of the above we urge all employers to undertake a self-review to ensure compliance. We have extensive experience in helping employers with their NMW compliance.  If you would like to talk to us about how we can help your business please contact me or your usual PwC contact.

 

John Harding

John Harding | Employment, Partner
Profile | Email | +44 (0) 7801 042 607

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