Kavitha’s keynote: There’s no excuse to flout minimum wage rules

HM Revenue and Customs (HMRC) this week revealed details of the numerous excuses given by employers for flouting minimum wage rules, which ranged from “the national minimum wage does not apply to my business,” to “it is part of UK culture not to pay young workers for the first three months as they have to prove their ‘worth’ first”.

While many of the responses are so outrageous that they’re laughable, the fact that workers are being underpaid is no joke – particularly at a time when the economy is slowly starting to open up again and so many people are just getting back on their feet again financially.

Steve Timewell, director, individuals and small business compliance, HMRC, warned that “any employer deliberately or unapologetically underpaying their staff will face hefty fines and other enforcement action”, but is this really enough to protect the UK’s lowest earners?

Meanwhile, it seems that while some employers are flouting minimum wage rules and denying workers of the most basic pay rate, at the other end of the spectrum the highest paid are not having to worry at all about their own financial wellbeing.

Analysis from the High Pay Centre found that the median-earning FTSE 100 chief executive in the UK was paid £2.69 million in 2020 – 86 times that of the median full-time worker.

According to Rachel Kay and Luke Hildegard, the report’s authors, the findings reflected the “wider gap between the rich and poor”. They suggest action must be taken to address pay inequalities and “raise incomes for low and middle earners”.

Perhaps this disparity in part explains why many employers are now using the challenges presented by the pandemic as an opportunity to review their pay policies. This is just one of the topics on the agenda at Employee Benefits Live, which is returning to ExCeL London on 6 and 7 October. For more information, visit www.employeebenefitslive.co.uk