4 Common Minimum Wage Offences and How to Avoid Them

Although most employers are aware that there is a minimum amount that they need to pay their employees in relation to the Minimum / Living wage some employers still get caught out and over 179 employers have been fined a total of £1.3 million for failing to pay minimum wage, in addition to this they were ordered to pay £1.1 million in back pay!

Today we focus on 5 common mistakes that could land you on the wrong side of the legislation:

1. Uniforms

You must not deduct sums that workers spend in connection with their job from their pay if this would take them below the minimum wage. This can be in relation to uniform requirements; where the employer requires that employees wear certain clothes but pay for this themselves. If you require your employees to wear a certain colour or item of clothing (such as black trousers or skirt in the case of Wagamama, or black shoes in the case of TGI Fridays or discounted clothes from their own range in the case of Karen Millen) then these count as uniform even if they do not carry a logo. If staff buy these items themselves you must check that this does not take their pay below the minimum. Remember this also applies to casual and part-time workers as well.

2. Understating Hours Worked

HMRC uncovered examples of failure to pay staff for additional work which had the effect of taking their hourly pay below the minimum. Examples include attending briefings, training, undergoing security checks outside of working hours, requiring staff to arrive earlier than their shift, not paying staff for travel time between assignments and not paying carers when they sleep in clients homes.

3. Counting Extra Payments as Wages

When calculating minimum wage you must exclude customer tips or a share of any service charge. Unsocial hours payments do not count towards wages either.

4. Not Paying Interns

Unless an individual is a student on a specific work placement as part of a course, a school pupil on work experience or a genuine volunteer you must pay them. This applies regardless of the duration of internship and experience level of the individual. If an individual is on a volunteering contract they must be truly free to come and go to avoid the risk of a tribunal considering them to be a worker.

If you have any questions please contact the office on 01325 288299 (option 2)