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Last Updated: Tuesday, 9 January 2007, 12:46 GMT
Minimum wage offenders targeted
Shop worker
More than 1,500 employers failed to pay minimum wage last year
Employers who do not pay staff the national minimum wage face a 200 fine for each worker affected, the government has announced.

The fine will be imposed on those who refuse to pay arrears to staff within seven days of a complaint being upheld.

The adult minimum wage increased to 5.35 per hour last October, which has benefited more than a million people.

But last year more than 1,500 employers were exposed for not paying the minimum wage to more than 25,000 workers.

Investigation

When workers make a complaint that they are not getting the minimum wage, Her Majesty's Revenue and Customs (HMRC) investigate the employer.

Under the new rules, if the employer is found to be at fault they are given seven days to pay back arrears they owe the worker.

Those employers who do not pay within seven days risk the 224.70-per-worker fine.

Previously employers were given 28 days to pay back arrears and could be fined at a rate of 10.70 per worker for each day that elapsed.

Employers who fail to pay the arrears within the time limit continue to face the possibility of a criminal prosecution, risking a further 5,000 fine.

We are determined that every worker should earn a fair wage for a day's work
Dawn Primarolo
Paymaster general

Announcing the crackdown, Trade and Industry Secretary Alistair Darling said: "Workers have the right to a decent minimum wage and we are determined they get it.

"To those employers avoiding the minimum wage the message is: Don't pay it and you'll pay the fine.

"In the last year alone the government's enforcement teams across the UK helped over 25,000 workers get more than 3m back in unpaid wages.

"The vast majority of good employers need to know they are operating on a level playing field. These measures will help deliver that."

'Fair wage'

Paymaster General Dawn Primarolo said: "We are determined that every worker should earn a fair wage for a day's work.

"HMRC enforcement teams work across the UK to educate employers and employees about their rights and responsibilities with the minimum wage and where necessary take enforcement action."

The Federation of Small Businesses (FSB) welcomed the announcement but said increases to the minimum wage were hitting some firms.

Alan Tyrrell, FSB employment chairman, said: "While we welcome any moves to eradicate unlawful and unfair competition, this must be done without unnecessarily disadvantaging the vast majority of law-abiding small businesses."

TUC general secretary Brendan Barber said: "From today, the minimum wage cheats will find it even harder to con their staff out of a legal wage.

"Rogue employers paying poverty wages will be up in court sooner than before and workers won't have to wait as long to get the wages they are owed."

David Frost, director-general of the British Chambers of Commerce, said: "We fully support the government's actions in clamping down on rogue businesses who seek to undercut the minimum wage.

"Firms who flout minimum wage regulations are providing unfair competition for the vast majority of employers who do not break the law and consequently have to charge higher rates."




SEE ALSO
Age law 'threat to minimum wage'
29 Sep 06 |  Business
CBI urges caution on minimum wage
25 Sep 06 |  Business
Minimum wage 'causing job losses'
21 Sep 06 |  Business

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