Low number of National Minimum Wage prosecutions

In April 2015, Yvette Cooper MP expressed concern that there had only been two prosecutions of employers not paying the minimum wage in the previous five years.

There was one in 2010/11 and one in 2012/13 out of 4,780 employers identified as not complying in the five years between 2009/10 and 2013/14.

HMRC’s approach is to use prosecution as a last resort where there has been "deliberate non-compliance or obstructive behaviour" and on a selective and exemplary basis. The independent Low Pay Commission has said that prosecutions can be costly in terms of resources. HMRC’s approach to NMW compliance can be found here.

The majority of employers found to be in breach will have paid arrears after receiving a formal notice of underpayment, and so won't have reached the point of prosecution.

This low number of prosecutions was highlighted in a report in The Guardian on 28 September.

It is well worth reading this report as it highlights some interesting issues, including the fact that some 700 employers have been “named and shamed” for underpaying the NMW but less than a quarter of a percent have been prosecuted.

Also, interestingly, this article comes just a week after we reported what may well become the largest ever National Minimum Wage claim being made by care workers at Sevacare.