Last week, the Department for Business, Innovation & Skills (BIS) published its latest quarterly ‘name and shame’ list of minimum wage offenders. And in doing so, it didn’t hold back in its condemnation of the 48 businesses included.
“There’s no excuse for companies that don’t pay staff the wages they are entitled to, whether by wilfully breaking the law or making irresponsible mistakes,” declared business minister Jo Swinson.
A report published last week estimates that £38.2m is underpaid to UK workers every year.
Yet, despite the Government’s tough rhetoric, for the handful of pub operators included on the list the reality is far from black and white. While the individual circumstances of each vary greatly, most have expressed a mix of concern, disappointment and anger to have even been named at all.
Number one on the list was G1 Group, which was found to have underpaid staff a combined total of £45,124. In a statement, the Scottish-based multi-site operator attributed the shortfall to asking “employees to make a small contribution towards the cost of workwear or training”.
It added: “We no longer apply these deductions, and any associated repayments have been made.”
While G1’s case seems reasonably straightforward, the experiences of single-site operators appear more complex. Wies Nowacki, who owns the Bull’s Head in Worcester, says his failure to pay £580.95 to three workers was as a result of him informing HMRC that an underpayment had been erroneously made when two of his staff, who are twins, reached the age of 21.
“I immediately paid the staff all the outstanding monies, but we were still named and shamed,” Nowacki says. “I think the process is a good idea if an employer is deliberately underpaying staff, but in this instance surely common sense should prevail.”
The Three Compasses, in Alford, Surrey, is also on the list — having failed to pay £344.72 to three employees.
Owner Sonia Duncton told the PMA the shortfall was down to incorrect advice given by her training provider about how much she could pay apprentices in a trial period.
“I was advised by my provider to put the staff on three-month trials before committing them fully to their respective apprenticeship courses. In the event, they shouldn’t have been on an apprenticeship wage during this period,” she explains.
“I have always paid my staff well above the minimum rate — so to be held to account in this way is really upsetting,” says Duncton. “I didn’t appeal because I was told I wouldn’t be successful. But one thing is certain — I won’t be taking on apprentices again.”
Another pub listed has even changed ownership since the offence occurred. Richard Ireton, who only bought the Bell at Skenfrith, Monmouthshire, in December, is
outraged that the pub has been named (albeit under its previous trading name of the Bell at Skenfrith Ltd) for a shortfall of £1,619.36 to one worker, an issue that was resolved months before he took over. He now plans to take legal action.
“I received a letter from BIS, addressed to the previous company, just five days before the list was published,” Ireton explains.
“Despite me threatening legal action, they still included the pub on the list. I’m now writing to lawyers, and I’ve written to my MP because I want something done about this. I’m bloody furious.”
Given the level of both national and local press attention the name and shame lists have received, it’s perhaps not surprising that industry trade bodies empathise with the concerns of the operators involved.
While adamant that pubs work hard to stay on the right side of the law, Kate Nicholls, chief executive at the Association of Licensed Multiple Retailers, believes there is currently limited government guidance for businesses unsure of the rules.
“We would like to see the Government provide additional assistance to help businesses understand the rules regarding minimum wages, and avoid grouping those who make genuine mistakes with repeat offenders and abusers,” Nicholls explains.
The British Institute of Innkeeping (BII) is equally sympathetic. Chief executive Tim Hulme says he fully supports the need for enforcement, but “would like to see a more collaborative approach with business owners in the future”.
The minimum wage offenders’ list isn’t likely to disappear any time soon, but it has to be hoped that BIS will at least take on board the concerns of the pub sector and reconsider how it is compiled.
■ BIS had failed to provide a response at the time of the PMA going to press.