Low Pay Commission urge Government to act
26 April 2019
In Non-compliance and enforcement of the National Minimum Wage LPC reports that “Our discussions with employers throughout the year revealed a high level of dissatisfaction with HMRC’s approach to enforcement. Some of this is inevitable – indeed, desirable – as part of the deterrent effect of enforcement. But too much friction between Government and employers could ultimately be detrimental to the effective enforcement of the minimum wage. To this end, transparency and consistency are key; the underpinning regulations and guidance must be as clear and accessible as possible, and the experience of being audited by HMRC not feel arbitrary, as some employers told us it was.”
Summary of LPC recommendations
- ‘We urge the Government to use all available opportunities to improve the measurement of underpayment, and to investigate new methodologies for assessing the scale of non-compliance.
- We recommend that the Government continues to invest strongly in communications to workers.
- We urge the Government to consider how to build confidence in the complaints process, and to work with trade unions to understand the current barriers to reporting.
- We recommend that the Government’s communications should build confidence in the third-party complaints process, including via guidance or case studies around successful complainants. We urge the Government to work closely with Acas, trade unions and other bodies to achieve this.
- We urge the Government to invest time in getting the guidance to employers right, as this will simplify the task of enforcement in the longer term.
- We recommend that the Government restart regular naming rounds to create momentum, increase coverage and allow stakeholders more time to prepare and support.’
LPC Chair Bryan Sanderson said:
“Our analysis reveals that a worrying number of people are being paid less than the minimum wage. We recently celebrated 20 years of the minimum wage – it has raised pay for millions of workers, but it is essential that people receive what they are entitled to. It is also vital for businesses to be able to operate on a level playing field and not be illegally undercut on wages.
The Government has made real progress with its enforcement of the minimum wage, but more needs to be done to ensure employers comply in the first place and workers know how to enforce their rights.”
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CIPP comment The CIPP policy team will be hosting a think tank roundtable which will be held on 10 June in Leeds. Invitations will be issued shortly to all CIPP Full, Fellow and Chartered members. To express your interest in attending this roundtable please contact Samantha Mann senior policy and research officer by email to [email protected].
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