Underpayment of the National Minimum Wage

HMRC publishes a series of five factsheets about the checks they conduct to ensure employers are paying workers at least the national minimum wage (NMW) or the national living wage (NLW).

The factsheets provide employers and employees with information on the type of checks HMRC make to ensure that employees are being paid at least the minimum legal amount they are entitled to as well the process for making an appeal via the Employment Tribunals.

During a visit to an employer HMRC are allowed to ask for:

  • any information they think will show whether workers are being paid at least the NMW or the NLW;
  • explanations of anything contained within records; and
  • any additional information we need to determine whether the NMW or the NLW has been paid.

There are penalties for employers that are found to have underpaid their workers and, in some cases, there may be criminal prosecutions. One of the factsheets entitled Guidance notes on the notice of underpayment – NMW FS3 has recently been updated with a new link to the appeals form for employers in England, Wales and Scotland.

The current NMW and NLW rates came into effect on 1 April 2024. The hourly rate for the NLW is £11.44 and for the NMW (18-20 year olds) £8.60.

Please contact Andrew Kilby in our payroll department for more information.

Source: HM Revenue & Customs Mon, 06 May 2024 00:00:00 +0100