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Category: HMRC

  • The government isn’t doing enough to protect exploited minimum wage workers

    The Department for Business, Energy & Industrial Strategy (BEIS) has published a list of over 200 businesses that have failed to pay their employees the national minimum wage. Low Pay Commission chair Bryan Sanderson stated that the aim of the list is to “help protect low-paid workers from unfair treatment”. But the government needs to do more to protect the rights of vulnerable minimum wage workers.

    Widespread exploitation of minimum wage workers

    Investigations by Her Majesty’s Revenue and Customs (HMRC) conducted between 2014 and 2019 identified 208 firms that failed to pay £1.2m to 12,000 workers, breaking national minimum wage laws.

    37% of companies listed were found to have wrongly deducted pay from workers’ wages, including for uniforms. 29% failed to pay employees for every hour they spent working, such as during mandatory training or trial shifts. 16% paid the incorrect apprenticeship rate. 11% failed to increase wages in line with the minimum wage increase, or paid younger workers at a lower rate.

    House of Fraser, Schuh and Waterstones are among the UK employers named. House of Fraser failed to pay £16,235.19 to 354 employees. Schuh failed to pay £807.38 to 39 staff. And Waterstones failed to pay nearly £8,700 to 58 staff.

    The national minimum wage for workers over the age of 23 is currently just £8.91. After years of wage stagnation and rising living prices, the Trade Union Congress TUC has argued the government needs to raise the legal minimum wage. It says it should be at least £10 per hour to avoid more workers being pushed into poverty. This makes employers’ theft of workers’ wages all the more appalling. £8,000 is pocket change for these corporations, but could be make or break for their minimum wage employees.

    In August 2021, the government published another list which “named and shamed” 191 businesses found to be breaking the minimum wage law. Employers on this list included John Lewis, Sheffield United, and The Body Shop International. HMRC found that companies owed a staggering £2.1m to more than 34,000 workers. Together, these lists demonstrate just how widespread the exploitation of minimum wage workers is.

    The government must do more

    TUC general secretary Frances O’Grady told the Independent:

    Every worker deserves fair pay for their work. There’s no excuse for not paying the minimum wage. Firms who cheat staff out of their hard-earned money deserve to be named and shamed.

    She added:

    We also need to see prosecutions and higher fines for the most serious offenders, especially those who deliberately flout the law. Minimum wage underpayment is still far too common in Britain.

    Although 6,500 breaches had been identified, as of August 2021, courts had prosecuted just six employers for paying employees below the minimum wage in the last six years.

    The government has ordered guilty employers to repay their employees. But if the government is serious about tackling the widespread exploitation of minimum wage workers, it must protect them by strengthening workers’ rights, supporting trade unions, and outlawing zero-hours contracts. ‘Naming and shaming’ companies isn’t enough. The government must hold these wage thieves to account.

    Featured image via Christopher Bill/Unsplash

    By Sophia Purdy-Moore

    This post was originally published on The Canary.

  • Don’t hate HMRC staff over their 13% pay rise

    People have been reacting to the news that the government is giving some HMRC staff a pay rise. Understandably, they’ve been making comparisons to NHS staff’s 1% increase. But as some people have said on social media – we shouldn’t begrudge HMRC staff a decent raise.

    That 13% HMRC pay rise

    The FDA is the trade union for “professionals and managers in public service”. It recently wrote about the government pay deal for some HMRC staff. The FDA said that talks on this pay deal started in July 2020 and now the government and trade unions have reached a deal. The FDA said this was:

    a three-year deal giving an average pay award of 13% across the term. A 3% increase would be awarded in March 2021 (backdated to June 2020), followed by a 5% increase in June 2021 and a 5% increase in June 2022.

    It wasn’t just the FDA which was involved. Other bodies such as the Public and Commercial Services (PCS) union were too. But some people on social media are upset about it. This is because the Tories are only giving NHS staff 1%:

    But people also made important points. Lina said:

    And another user pointed out:

    Divide and conquer

    Moreover, people pointed out that it plays into the Tories’ divide and conquer agenda, among other things:

    Of course, in reality most public sector staff have seen their real terms pay take a hit since 2010. As Unison pointed out, the cost of living (inflation) in the last decade rose by 35.6%. It noted that:

    The average public sector worker has seen an even steeper 14% decline in the value of their wages. For the public sector worker who has not benefited from any incremental progression in their pay, the cut has been 18%, leaving their 2020 wage over £6,800 down on the value of their earnings in 2009 and the accumulated loss from their wage failing to keep pace with inflation each year standing at over £53,307.

    So, HMRC staff’s 13% rise across three years barely makes up for a lost decade.

    Scraps off the Tories’ table

    Meanwhile, as one Twitter user said, the situation for nurses is dire:

    And let’s not forget the “inadequate” £20 Universal Credit uplift. Nor must we ignore the millions of legacy benefit claimants who haven’t got any increase at all. The number of households living in destitution more than doubled in 2020. But never mind. Because while all this was going on, Boris Johnson’s former aide Dominic Cummings got a 40% pay rise in 2020. And MPs, meanwhile, got an “inflation-busting” 3.1% pay rise, bringing their annual salary close to an eye-watering £82k.

    So we shouldn’t be angry at other workers earning more money. Our anger should be directed at a system and its gatekeepers which allow so many people to live in poverty in the first place. HMRC staff getting scraps off the Tories’ table is the thin end of the wage crisis wedge.

    Featured image via DPP Law – Flickr

    By Steve Topple

    This post was originally published on The Canary.