Pubs underpaying workers ‘should be named and shamed’

By Emily Hawkins contact

- Last updated on GMT

Wage regulations: the Low Pay Commission (LPC) said more guidance for employers was needed from the Government
Wage regulations: the Low Pay Commission (LPC) said more guidance for employers was needed from the Government

Related tags: Pubs, Wage

The Low Pay Commission (LPC) has urged the Government to restart regularly naming employers who are found underpaying the minimum wage.

The independent body recommended the Government improve its guidance to businesses because its analysis found the number of people being underpaid had increased year on year.

Hospitality was one of the sectors with the largest number of underpaid employers, though this could be because it is one of the trades to employ the most minimum wage workers.

Some 14.4% of all national minimum wage workers are employed in the hospitality sector.

Proportionally, hospitality was one of the few sectors to buck the national trend. The proportion of workers who were underpaid in 2018 decreased to 18%, from 20% the year previous.

“We recommend that the Government restart regular naming rounds to create momentum, increase coverage and allow stakeholders more time to prepare and support,” the commission's report said.

No excuse

UKHospitality chief executive Kate Nicholls said she was concerned that businesses would be named and shamed for honest mistakes.

She said: “There is no excuse for deliberate underpayment of staff. Businesses should not be paying below the minimum wage rates and we are fully supportive of efforts to tackle rogue employers, including naming and shaming for deliberate underpayment.

“We are concerned that, in the past, some employers have been unsure about regulations, particularly where things like accommodation offset are involved and hospitality employers have been named and shamed because of honest mistakes.

“We absolutely do not condone paying below the legal minimum, but some businesses have been penalised because of a lack of clarity in the current system or through miscommunication.”

Worrying numbers

The committee concluded there were areas of confusion for employers, such as how to correctly calculate a simple hourly rate for salaried workers.

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.”

Related topics: Legislation

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