Primark and Sports Direct named on minimum wage non-compliance list

Sports Direct

Retail organisations Primark and Sports Direct are among the 260 employers named by the Department for Business, Energy and Industrial Strategy (BEIS) for failure to pay employees the national minimum wage and national living wage.

Primark, which ranked third on the government’s list of organisations that have underpaid staff the minimum wage, failed to pay £231,973,12 to 9,735 employees. Sports Direct, which was placed fourth on the list, failed to pay £167,036.24 to 383 employees.

Employment organisation The Best Connection Group topped the government’s list for failing to pay 2,558 employees a total of £469,273.83, while recruitment organisation Qualitycourse, trading as Transline Group, ranked in second place for its failure to pay £310,302.12 to 1,421 staff.

Other organisations that feature on the list include Edward Mackay Contractor, which failed to pay £51,403.65 to four employees, and Ramside Estates, which failed to pay eight employees £17,536.59.

The government’s naming and shaming scheme, which came in to effect in October 2013, names employers which have underpaid staff by paying them less than the national minimum wage and national living wage rates. These employers are issued with a notice of underpayment, unless employers meet one of the exceptional criteria or have arrears of £100 or less. Organisations that feature on the published list are required to back pay arrears of wages to affected employees, and can face financial penalties of up to 200% of arrears, capped at £20,000 per employee, or prosecution in the most serious cases.

Employers on today’s (8 December 2017) list have been fined £1.3 million in total, and more than 16,000 UK employees are expected to receive back pay amounting to £1.7 million.

Sectors that particularly came under fire during this naming and shaming round include the hospitality sector, where 58 organisations are required to back pay 288 employees, the hairdressing industry, where 40 businesses failed to pay 118 employees, and the retail sector, with 34 organisations that neglected to pay 11,072 employees the minimum wage.

Since the scheme’s introduction in 2013, £8 million has been paid in back pay to 58,000 employees and a total of 1,500 employers have been fined £5 million overall. This year, the government committed to spend a record £25.3 million on minimum wage enforcement.

Margot James, business minister, said: “There is no excuse for not paying staff the wages they’re entitled to and the government will come down hard on businesses that break the rules.

“That’s why today we are naming hundreds of employers which have been short changing their [employees] and, to ensure there are consequences for their wallets as well as their reputation, we’ve levied million in back pay and fines.”

Bryan Sanderson, chairman at the Low Pay Commission, added: “The Low Pay Commission’s conversations with employers suggest that the risk of being named is encouraging businesses to focus on compliance.

“Further, it is good to see that HMRC [HM Revenue and Customs] continues to target large employers which have underpaid a large number of [employees], as well as cases involving only a few [employees], where [staff] are at risk of the most serious exploitation. It is imperative that the government keeps up the pressure on all employers that commit breaches of minimum wage law.”