Big companies that don’t pay minimum wage ‘named and humiliated’ | UK News

Companies that didn't pay the PA/Shutterstock minimum wage

WHSmith was the worst offender, according to the government (Picture: PA/Shutterstock)

A number of high street giants failed to pay their staff the minimum wage, the government said.

The Department for Business and Trade today ‘named and shamed’ 202 companies for leaving 63,000 low-paid workers ‘out of pocket’ £5,000,000.

This breaches minimum wage law, where paying less than the national minimum wage or national living wage is illegal, according to the Acas Conciliation Service.

Any companies at fault face penalties of almost £7,000,000 and must reimburse workers for the money owed to them.

Spokespersons for the companies attributed the breaches, which mostly occurred between 2017 and 2019, to technical payroll issues since resolved and other unintentional errors.

WHSmith, which recorded pre-tax profits of £63,000,000 in its last financial year, was the worst offender, according to the HM Revenue & Customs survey.

File photo dated 23/01/13 of a general view of a branch of WH Smith in London, as the retailer has revealed plans to open more than 120 new stores after a surge in travel demand has helped sales skyrocket over the past six months.  PA picture.  Issue date: Thursday April 20, 2023. WH Smith has also seen its profits more than double as it continues to focus more on airport and train station stores instead of its traditional outlets.  See PA Story PA CITY WHSmith.  Photo credit should read: Philip Toscano/PA Wire

WHSmith harmed ‘more than 17,000 workers’, according to HMRC (Picture: PA)

HMRC figures claim the high street retailer failed to pay around £1,000,000 to 17,607 workers.

WHSmith said: ‘Following a review with HMRC in 2019, and in common with a number of retailers, it has come to our attention that we have misinterpreted the way statutory wage regulations were applied to our uniform policy for staff working in our stores.

“It was a real mistake and it was rectified immediately with all colleagues reimbursed in 2019.”

Nearly 8,000 Lloyds Pharmacy workers lost £900,000, the trading department said.

M&S and Argos, which is owned by Sainsbury’s, were next on the list, paying nearly £578,000 to 5,363 workers and £480,000 to 10,399 workers respectively.

An M&S spokesperson said: ‘Like many other organisations, M&S is only named to the NMW list due to an unintended technical issue over four years ago.’

File photo dated 27/10/14 of the main entrance to an Argos store, as Argos has announced plans to close all of its stores and operations in the Republic of Ireland by the end of June this year .  PA photo.  Issue date: Thursday January 19, 2023. See PA story IRISH Argos.  Photo credit should read: John Stillwell/PA Wire

Argos’ failure was due to a ‘payroll error’, the Sainsbury owner has pointed out (Picture: PA)

“This happened simply because temporary colleagues were not paid within the strict deadlines specified in the NMW regulations and it was remedied as soon as we became aware of the problem.

“Our minimum hourly wage has never been lower than the national minimum wage, it is currently higher than it and no colleague has ever been underpaid because of it.”

A Sainsbury’s spokesperson added: ‘In 2018 a payroll error was identified which affected some colleagues and drivers at the Argos store and dated back to 2012 – before Sainsbury’s acquisition of Argos. We launched an immediate investigation, working with HMRC, and sorted things out at that time.

The spokesperson stressed that the company’s acquisition of the catalog retailer being completed “will prevent this from happening again.”

Business leaders said companies had “launched” employees in three ways.

About four in 10 either withheld workers’ pay or failed to pay workers properly for their time, while two in 10 paid the wrong apprenticeship rate.

Also on the list is Buzz Group, otherwise known as Buzz Bingo, which is the largest retail bingo operator in Britain; the hotel company Baxterstorey and the construction company McNicholas Construction.

LONDON - NOVEMBER 25: The exterior of Marks and Spencer's on November 25, 2014 in London, England, UK.  M&S is one of the UK's leading high street retailers.;  Shutterstock ID 233226913;  purchase order: -;  job: -;  customer: -;  other: -

M&S was also on the list (Picture: Shutterstock/Michaelpuche)

A spokesperson for Buzz Bingo pointed out that the company had “always paid the national minimum wage or more”.

“So when these issues came to light five years ago, we immediately took action to revise our time recording technology and staff uniform policies so that the issues raised could not be repeated,” they said.

“We would never intentionally sacrifice our hard-working team and in 2018 we apologized to all affected colleagues and immediately reimbursed them for any losses.”

A spokesperson for BaxterStorey said HMRC alerted them to a payroll ‘error’ in 2018.

“We have worked closely with HMRC to put processes in place to ensure this mistake does not happen again. We deeply appreciate the contributions of our employees and remain committed to maintaining a fair and supportive work environment for all,” they added.

Minister for Enterprise, Markets and Small Business Kevin Hollinrake said payment of the minimum wage, which rose 9.7% in April, is “non-negotiable”.

“Companies, regardless of size, should know not to sacrifice hard-working staff,” he said.

“Most companies do the right thing and look after their employees, but we send a clear message to the minority who ignore the law: Pay your staff properly or face the consequences.”

Bryan Sanderson, chairman of the Low Pay Commission, which advises the government on minimum wages, said: “The minimum wage acts as a guarantee to ensure that all workers without exception receive a decent minimum wage.

“When employers break the law, they not only do their staff a disservice, but they also undermine fair competition between businesses.

“Regular nomination rounds should be a useful tool to raise awareness of underpayment and help protect minimum wage workers.”

Lloyds Pharmacy and McNicholas Construction have been approached for comment.

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