More than 450 Cardiff workers were underpaid the National Minimum Wage by £243,000 last year, HM Revenue and Customs (HMRC) has revealed.
HMRC is writing to more than 5,000 employers in the Cardiff area to highlight common mistakes around the National Minimum Wage (NMW) and National Living Wage (NLW) – offering support to help them get it right and reminding them of their legal obligation.
Employers sometimes fail to take account of deductions or payments for items connected to a job, such as uniforms, in their salary calculations – which can take workers below the minimum wage. Other mistakes include not paying employees for the entire time they have worked, or for training time, and not paying apprentices correctly.
Businesses failing to comply with minimum wage rules could face penalties of up to 200% of their arrears – plus having to pay the arrears owed to workers and employers may also be publicly named.
Marc Gill, Director of Individuals and Small Business Compliance at HMRC, said:
“We want Cardiff workers to get the pay they’re due under minimum wage rules and it’s their employers’ responsibility to ensure this happens.
“HMRC is here to support businesses to get it right. Our information and checklist will help employers pay what their workers are due and assist them in identifying any possible mistakes, so they can make sure their staff are not losing out.”
The five most common causes of NMW underpayment are:
1.Extra time added on to the start or end of your shift that you are not paid for:
This could be attending handover meetings, completing security checks, or performing cleaning duties at the start or end of your shift, and you are not paid for the extra time you spent working.
2.Travel time you are not paid for:
If you have to travel in connection with your job and you are not paid for this time. This includes travelling from one work assignment to another or travelling to training. It does not include travel between work and home.
3. Time spent training that you are not paid for:
If you have to spend time training in connection with your job and you are not paid for this time
This includes training that takes place at work, at home, or outside of your normal working hours.
4.Paying for items connected with your job, which are deducted from your salary and could take you below the minimum wage:
This includes things like paying for tools, equipment, uniforms, or items of clothing needed to meet a dress code.
5.Mistakes when paying apprentices:
Not paying for all the time worked.
Failing to pay the minimum wage following the annual increase.
HMRC is also offering around 1,400 employers in Cardiff a free support call with one of our National Minimum Wage / National Living Wage experts. During these calls employers can discuss their minimum wage concerns and ask questions. HMRC can help identify any mistakes and, if needed, help put things right. If a business corrects the mistakes as a result of the support call, HMRC will not charge any penalties.
Employers can access support at any time to ensure they are paying the NMW correctly:
- view the online employers’ guide on calculating the minimum wage
- Contact the ACAS helpline on 0300 123 1100 for confidential, free advice (Monday to Friday, 8am to 6pm)
- view our recorded webinars on various minimum wage topics which can be accessed by clicking this link: National Minimum Wage videos and webinars
1.The letters are part of HMRC’s regular compliance outreach activity, which focus on specific areas of the UK by offering support and helping businesses identify risks.
2.Further information about the National Minimum Wage, including who is eligible, is available on GOV.UK at:
3.HM Revenue and Customs (HMRC) is responsible for the enforcement of National Minimum Wage legislation. The Department for Business and Trade is responsible for National Minimum Wage (NMW) and National Living Wage (NLW) policy.
4.The current National Minimum Wage hourly rates from 1 April 2023 are:
- Age 23 or over (National Living Wage): £10.42
- Age 21 to 22: £10.18
- Age 18 to 20: £7.49
- Age under 18: £5.28
- Apprentice: £5.28
5.By law, workers must be paid at least the minimum wage for their age for all their time spent working. If somebody thinks they may have been underpaid, they can report this online to HMRC at: https://www.gov.uk/minimum-wage-complaint or contact the ACAS Helpline on 0300 123 1100 for confidential, free advice.
6.Employers who do not pay the NMW can be publicly ‘named’. The most recent list was published by the Department for Business and Trade (DBT) on 21 June 2023. Those who blatantly fail to comply can face criminal prosecution, but most employers pay up when they realise mistakes have been made as they want to get things right.
7.Follow HMRC’s Press Office on Twitter @HMRCpressoffice