Posted on Leave a comment

How effectively does the government deal with criminal employers who fail to pay the minimum wage?

The National Minimum Wage is currently £5.20 and hour for 18-20 olds, rising to £7.83 per hour for those aged 25 and over.

According to one recent study (based on a survey of 4000 workers), 20% of 18-30 year-olds reported being paid less than the minimum wage, which is, on the part of their employers, illegal.

Formal detection and prosecution rates, however, are much lower than this reported 20%…

Between 2013-2018 the government fined around 17, 000 employers for failing to pay their workers the minimum wage, with a total number of 67 000 workers being underpaid. Collectively, these criminal employers have had to pay £9 million in back pay for and have been fined an additional £6.3 million in total.

The most likely offenders were retail and hospitality, but it’s not just small businesses illegally underpaying their workers, there are some big names in there too, such as certain branches of Wagamama’s and TGI Friday’s.

Screen Shot 2019-03-04 at 10.06.31.png

The stats suggest that the government isn’t punishing these criminal employers sufficiently 

  • This doesn’t seem to be very ‘victim centred’ – from the perspectives of the victims (the underpaid workers) – If you work out the average underpayment (£9m/ 67K) this = £134 per worker, now this not may sound like a lot, but if you’re on minimum wage, then this could well be a significant amount of money!
  • The government has the power to fine underpaying employers 200% of wages not paid, whereas if they’re paying back £6 million on £9 million not paid, this is nearer 60%. Minimum wage is around £7, and if you get caught underpaying then you pay an additional £4 on top – it is a deterrent, but not much of one… these are the kind of figures that could well encourage some employers to gamble and try and get away with underpaying workers.
  • As far as I’m aware, none of these criminal employers have gone to jail for failing to pay minimum wage, they have only been fined, so there’s no physical deterrent – unlike if you steal something, which is basically what this is.
  • Add to this the fact that these employers have to know what they are doing… underpaying the minimum wage simply is not something you can do accidentally! The above fines seem like very soft punishment for powerful actors pre-meditatively steeling from their vulnerable workers.

So it appears if you’re unfortunate enough to be employed by an employer who breaks the law and pays you less than the minimum wage, then you’re not going to get justice under the present government.

Overall this seems to be great evidence to support the marxist theory of crime and punishment – the idea that elites do not get punished effectively when they break the law.

 

Advertisements

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.