relating to a pay reference period beginning on or after 1 April 2016. The maximum penalty is £20,000 per worker. The revised penalty is calculated as 200% of the total underpayment for all of the workers specified in a Notice of Underpayment relating to pay reference periods that commence on or after 1 April 2016. Where this amount would be less than £100, the minimum penalty of £100 should still be applied. Where this amount would be more than £20,000, the maximum penalty of £20,000 per worker should be applied. The penalty is reduced by 50% if the unpaid wages are paid within 14 days. Naming and shaming If HMRC investigates an employer that is breaking minimum wage law they will be issued with a Notice of Underpayment by HMRC. This is a formal notice that sets out the arrears of minimum wage to be repaid by the employer together with the penalty for non-compliance with the requirement to pay workers the minimum wage. An information sheet is given to the employer at the start of the investigation which sets out details about the BIS naming scheme. The employer will have 28 days to appeal against the Notice of Underpayment issued by HMRC. If the employer does not appeal or an appeal has been unsuccessful HMRC will refer the employer to BIS for automatic naming under the scheme.
Further details can be found in the policy document on National Minimum Wage and National Living Wage law enforcement .
Employers could be exposed to age discrimination 5 April 2016
With the introduction of the National Living Wage, employers who offset the costs by altering terms and conditions of employment contracts could leave themselves open to age discrimination claims.
An interesting article by the CIPD has highlighted a petition signed by more than 120,000 B & Q staff which accuses the DIY retailer of slashing employee benefits in an effort to offset the costs of the National Living Wage (NLW). This has subsequently led to warnings that employers could face a negative reaction and leave them susceptible to age discrimination claims if they attempt to alter terms and conditions at the same time as they are forced to raise salaries for the lowest-paid. The petition says the retailer has suggested removing time-and-a-half pay for working Sundays and double time for working bank holidays; a restructuring of allowances for employees working in parts of the UK where the cost of living is higher; and the removal of a summer and winter bonus, which equates to 6 per cent of annual salary. The article also discusses findings from a survey conducted by the Federation of Small Businesses which found that just over half of SMEs believe they will be negatively impacted by the 50p an hour increase in pay, and will put off hiring new staff as a result, while 41 per cent will cut staff hours. Just over a quarter plan on eroding pay differentials by freezing or cutting the wages of higher-paid staff.
Read the full article from the CIPD .
CIPP Policy News Journal
25/04/2016, Page 253 of 453
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