Government announces new measures to ensure workers receive fair pay

s300_department-for-business-innovation-skillsOn 1 September 2015 the Business Secretary, Sajid Javid, announced a package of measures to ensure that workers receive the pay they are entitled to.

The measures include:
• doubling the penalties for non-payment of the National Minimum Wage and the National Living Wage, which is due to be introduced next April
• increasing the budget for enforcement
• setting up a new team within HMRC to take forward criminal prosecutions for those who deliberately do not comply
• ensuring that anyone found guilty will be considered for disqualification from being a company director for up to 15 years

To increase compliance the calculation of penalties for non-compliance will increase from 100% of arrears to 200%, although this will be halved if employers pay within 14 days. The maximum penalty of £20,000 per worker remains unchanged.

A new team of compliance officers in HMRC will investigate the most serious cases of employers not paying the National Minimum Wage and National Living Wage, once introduced. They will have the power to use all available sanctions, including penalties, prosecutions and “naming and shaming” employers.

A new Director of Labour Market Enforcement and Exploitation will be created to oversee enforcement of the National Minimum Wage, the Employment Agency Standards Inspectorate and the Gangmasters Licensing Authority. A new consultation is to be launched in the Autumn which will propose giving the Gangmasters Licensing Authority additional investigatory powers and a broader remit to be able to tackle labour exploitation more effectively.

For advice on the National Minimum Wage or the National Living Wage contact Helen Kay on or .

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