The Government has announced a package of measures to improve compliance with the National Minimum Wage (NMW) and, when it is introduced next year, the National Living Wage (NLW).
The measures include:
- Doubling the penalties for non-payment of the NMW and the NLW, meaning that the penalties faced by those who do not comply will rise from 100% of the arrears to 200%, although this will be halved if the employer pays within 14 days. The overall maximum penalty of £20,000 per worker will remain unchanged.
- Increasing the enforcement budget in 2016.
- Setting up a new team of compliance officers in HMRC to take forward criminal prosecutions for those who deliberately do not comply. The team will have the power to use all available sanctions, including penalties, prosecutions and naming and shaming employers.
- Ensuring that anyone found guilty will be considered for disqualification from being a company director for up to 15 years.
- Appointing a new Director of Labour Market Enforcement and Exploitation to oversee enforcement of the NMW, the Employment Agency Standards Inspectorate and the Gangmasters Licensing Authority. The Director will set priorities for enforcement based on a single view of the intelligence about exploitation and non-compliance.
- Improving the guidance and support made available to firms on compliance and working with payroll providers to ensure that payroll software contains checks that staff are being paid what they are entitled to.
No details have been given as to when these new measures will come into force.