Fines of £1.9m levied against UK employers underpaying workers

About 230 organisations are involved, with the worse offenders being in retail, hairdressing and hospitality.

The most common excuses made by UK employers for failing to pay staff their dues include deducting pay to cover uniforms, paying apprentices the wrong wage and not accounting for overtime.

The Department for Business, Energy and Industrial Strategy has named and shamed 230 organisations that have not paid their employees either the national minimum or national living wage. They will now be required to fork out about £2 million in back pay to as many as 13,000 workers and face record fines of £1.9 million at the same time.

Businesses in the retail, hairdressing and hospitality sectors were the worst offenders, with high street store Argos topping the list. It failed to pay just under £1.5 million to 12,176 workers who were required to attend briefings without renumeration before their shifts started. They also had to undergo searches at the end of the day.
Argos’ chief executive John Rogers said that the firm, which was fined £800,000, had taken immediate action as soon as the issue was discovered and an investigation carried out.

“Shortly after we [Sainsbury’s] acquired the Argos business last year, it was brought to my attention that, as part of a routine visit, HMRC had uncovered an issue with some Argos store systems and processes, which meant that some colleagues had been paid below the national living wage,” he said.

Rogers added that the issue had been resolved “quickly” and the company’s processes had now been updated “to ensure this cannot happen again”.

Despite the government crackdown, it is thought that hundreds of thousands of workers across the UK are still not being paid their legal entitlement. In October last year, the Office for National Statistics put the figure at 362,000. HMRC is currently investigating about 2,000 cases of underpayment.

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