The government has named and shamed five employers for failing to pay the correct national minimum wage.
The first of these, a tougher naming and shaming scheme, came into effect from 1 October 2013.
Five employers are the first to be named under the rules. Between them, these employers owe employees a total of more than £6,800 in arrears and have been charged financial penalties totalling £3,381.40.
The five employers are:
- Peter Oakes which neglected to pay £3619.70 to two employees.
- Salon Sienna which neglected to pay £1760.48 to one employee.
- Minto Guest House which neglected to pay £808.56 to one employee.
- Chambers Hairdressers which neglected to pay £452.22 to one employee.
- Ruzi Ruzyyev, a car wash operator, which neglected to pay £225.38 to one employee.
As well as being publicly named and shamed, employers that fail to pay their workers the national minimum wage will face higher financial penalties of up to £20,000 from 7 March 2014.
The new higher penalties will increase the national minimum wage financial penalty percentage from 50% to 100% of total underpayments, and the maximum penalty applied from £5,000 to £20,000.
The government also plans to legislate at the earliest opportunity so that employers will also be given penalties of up to £20,000 for each individual worker they have underpaid, rather than the maximum fine applying to each employer. In the most serious cases, employers can also face criminal prosecution.
Vince Cable, business secretary, said: “Paying less than the minimum wage is illegal. If employers break the law they need to know that they will face tough consequences.
“We know that people are put off using a business’ service if it is found guilty of not paying its workers the minimum wage. This is a clear warning to employers: you will damage your reputation and face a stiff penalty, if you don’t pay the minimum wage.
“Any worker who is entitled to the minimum wage should receive it. It’s not only fair; it’s the law.”