What penalties apply for National Minimum Wage non-compliance by employers.
This is a freeview 'At a glance' guide to penalties and the National Minimum Wage.
Where HMRC identify that an employer has failed to pay the National Minimum Wage they may issue a notice requiring:
- The arrears of wages to be paid to the worker.
- A financial penalty to be paid to the Secretary of State.
From 26 May 2015, the basis for the maximum National Minimum Wage (NMW) penalty has changed from £20,000 per notice to £20,000 per worker.
For pay reference periods starting on or after 1 April 2016 the underpayment penalty is 200% of the underpayment subject to the £20,000 per worker maximum as above.
The minimum penalty per notice is £100.
Employers have 28 days from the date of service of the notice to lodge an appeal.
In serious cases of non-compliance, employers may be prosecuted which can result in an unlimited fine.
HMRC periodically 'name and shame' employers failing to meet the minimum wage. For such a release in December 2021, see: Over 200 employers called out for falling short of paying staff the minimum wage
Loving our content? 😍
Join thousands of accountants and advisers and their clients use www.rossmartin.co.uk as their primary TAX resource.
Register with us now (for free 😅) to receive our receive our FREE weekly SME Tax News updates.
