Yesterday, a beauty salon owner became the first employer to be publicly named under a scheme launched by the Department for Business, Innovation and Skills (BIS) in January 2011 for failing to pay an employee the national minimum wage (NMW).
The scheme aims to deter non-compliance with NWM law by naming employers who violate it. Currently, an employer will be named if it does one of the following;
- knowingly or deliberately fails to comply with its NMW obligations;
- has previously received advice from HMRC about the steps it needs to take to ensure future compliance with NMW with which it has not complied;
- has failed to take adequate steps to keep or preserve NMW records;
- delays or obstructs a NMW compliance officer in the performance of their duties;
- refuses or neglects to answer a NMW compliance officer's questions;
- refuses or neglects to provide information or produce documents to a NMW compliance officer, or
- refuses or neglects to pay arrears of the NMW to workers following HMRC intervention, which has resulted in HMRC taking action against the employer to ensure payment of arrears to workers.
Employers found to meet the criteria for naming are notified by BIS and invited to make representations against being named within 28 days. However, HMRC will not refer cases to BIS unless the total arrears owed to workers are at least £2,000 and the average arrears per worker are at least £500.
Further information can be found here.