A range of measures to ensure that businesses comply with their wage obligations have been announced today by the government.
The national minimum wage is due to increase form £6.50 to £6.70 for people 21 and over from 1 October 2015. The introduction of the mandatory national living wage for people 25 and above, initially set at £7.20, follows in April 2016.
The measures announced include:
- Doubling penalties for non-payment and non compliance
- A new team to handle criminal prosecutions will be set up at HMRC
- Increasing the budget for enforcement
- Ensuring that those found guilty will be considered for disqualification from being a company director for 15 years.
The penalties for companies failing to pay at least the minimum wage will now be 200% of arrears, halved if the company pays the penalty within 14 days.
The maximum penalty for individual workers will remain at £20,000.
The new HMRC team of compliance officers will have a number of powers at their disposal including penalties, and naming and shaming.
John Allan, national chairman for the Federation of Small Businesses, said:
As well as focusing on enforcement, the government must clearly and proactively communicate the charge to employers - ensuring businesses fully understand what they need to do and when.
Talk to one of our accountants today to learn more about how this might affect your wage obligations.