Debenhams tops government’s minimum wage non-compliance list

Retail organisation Debenhams has topped the government’s list of organisations that have underpaid staff the minimum wage after failing to pay £134,894.83 to 11,858 employees.

The Department for Business, Energy and Industrial Strategy published the names of 360 UK organisations that have failed to comply with the national minimum wage and national living wage. Together, these organisation underpaid 15,520 employees a total of £995,233.

HM Revenue and Customs (HMRC) has issued penalties worth approximately £800,000, in addition to recovering arrears for underpaid employees.

For the first time, the 2017 list features employers that have failed to pay eligible staff the national living wage. Applicable for employees aged 25 and over, the national living wage is currently set at £7.20 an hour. This is due to increase to £7.50 an hour from April 2017.

Other organisations named for underpaying staff include Pembrokeshire Care, which failed to pay £55,056.75 to 154 employees, and Osteria San Lorenzo, which failed to pay 29 staff members £53,496.57.

The government’s naming and shaming scheme has named more than 1,000 employers since its launch in October 2013, with arrears totalling more than £4.5 million. Over £2 million in fines have been issued to organisations that have failed to comply with the national minimum and national living wage. There are currently 1,500 open cases that are still being investigated by HMRC.

Margot James, business minister, said: “Every worker in the UK is entitled to at least the national minimum or [national] living wage and this government will ensure they get it. That is why we have named and shamed more than 350 employers who failed to pay the legal minimum, sending the clear message to employers that minimum wage abuses will not go unpunished.”

A spokesperson at Debenhams said: “Debenhams made a technical error in its payroll calculations, which resulted in an average underpayment of around £10 per person to the affected colleagues in 2015.

“As a responsible employer, Debenhams is committed to the national minimum wage, and as soon as the error was identified by a routine HMRC audit last year, we reimbursed all those affected. We have apologised to all our colleagues affected and have taken steps to ensure it cannot happen again.”

Steve Turner, assistant general secretary at trade union Unite, added: “The government needs to crack down further on employers who failed to pay the national minimum wage to some of the most-low paid and vulnerable [employees] in the country.

“What the government has introduced is welcome, but it is only a small step in the right direction and much more is needed. To address growing levels of poverty a genuine living wage must be introduced, sector level collective bargaining introduced and stronger, more effective enforcement funded.”