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Councils To Enforce National Minimum Wage

Tuesday, March 24, 2015

GMB Support Local Councils Having Powers To Enforce National Minimum Wage As 48 More Firms Named And Shamed By BIS For Not Paying

Labour Party general election manifesto commitment to implement Newham's proposals for local authorities to investigate and prosecute employers who exploit their workers is welcome says GMB.

Newham Council, in partnership with GMB, today (24th March) publish a report called  “Pay By The Rules”  which demands that Government allows local authorities to use their local knowledge and expertise to tackle exploitative businesses who fail to pay the National Minimum Wage (NMW). See report attached as pdf at the foot of this release on the GMB website at www.gmb.org.uk .

The Labour Party has committed to local enforcement of the NMW being included in their general election manifesto and the report outlines how that can be achieved.

The publication of the report coincides with the release by BIS of the names of a further 48 employers named and shamed by BIS for failing to pay the national minimum wage.  See list below and notes to editors for copy of the BIS press release dated 24th March 2015.

The 48 employers named today (24 March 2015) are:

·    G1 Venues Ltd, trading as Arta Restaurant, Glasgow, neglected to pay £45,124.00 to 2895 workers

·    The Clothing Works Ltd (ceased trading), Corby, neglected to pay £17,007.08 to 38 workers

·    Freedom Sportsline Ltd, trading as Foot Locker, London, neglected to pay £16,718.25 to 601 workers

·    French Connection UK Ltd, London, neglected to pay £16,436.05 to 367 workers

·    Minara Enterprises Ltd, trading as Fakenham Tandoori, Fakenham, neglected to pay £11,696.47 to 1 worker

·    Sharon Makin, trading as Clever Clowns Day Nursery, Manchester, neglected to pay £10,572.08 to 6 workers

·    UK Gaming Computers Ltd, Colchester, neglected to pay £6,036.99 to 2 workers

·    Sarah Sloane and David Sloane, trading as Hawes Side Nursery, Blackpool, neglected to pay £2,825.58 to 3 workers

·    Weston Hire Services Ltd, Weston-super-Mare, neglected to pay £2,819.79 to 1 worker

·    Miss C Glendon & Miss S Glendon, trading as Ciara’s Tots Day Nursery, Manchester, neglected to pay £2,549.23 to 1 worker

·    Florence Opportunities Ltd, trading as Morgan Edward Hair & Beauty, Carmarthen, neglected to pay £2,201.99 to 1 worker

·    Champneys Springs Ltd, Swadlincote, neglected to pay £1,950 to 5 workers

·    H M Bodyshop Ltd, Colindale, London, neglected to pay £1944.83 to 1 worker

·    David Hayton Ltd, Penrith, neglected to pay £1,865.48 to 1 worker

·    Caledonian Leisure Sales Ltd, trading as Hurleys Operations, Birmingham, neglected to pay £1,628.63 to 1 worker

·    The Bell at Skenfrith Ltd, Skenfrith, neglected to pay £1,619.36 to 1 worker

·    Miss Kerris Dunne, Mr Frederick Dunne, and Mrs Alison Ashforth, trading as Aerobrights, Stafford, neglected to pay £1,529.82 to 6 workers

·    Mortgages First Ltd, Colchester, neglected to pay £1,475.63 to 3 workers

·    Fullworks (Ayrshire) Ltd, trading as The Full Works, Irvine, neglected to pay £1,362.76 to 2 workers

·    Crazy Divas Ltd, trading as Divas, Colchester, neglected to pay £1,316.74 to 4 workers

·    Glenview Development Partners Ltd, Tullibody, neglected to pay £1,150.42 to 1 worker

·    Toni & Guy (Wilmslow) Ltd, Wilmslow, neglected to pay £1,031.12 to 1 worker

·    Vertu Motors Plc, trading as Bristol Street Motors, Gateshead, neglected to pay £1,001.42 to 1 worker

·    PNP Media Ltd, trading as EBS Marketing, Manchester, neglected to pay £981.06 to 2 workers

·    Mr Trevor Trutwein, trading as Ambitions 2, Gillingham, neglected to pay £903.32 to 1 worker

·    Mr Anthony Miller, trading as Sportline Car Sales, Coalville, neglected to pay £779.70 to 2 workers

·    The Conde Nast Publications, London, neglected to pay £745.48 to 1 worker

·    Mr Yong Zhang, trading as Dragon Cottage Chinese Takeaway, Loughborough, neglected to pay £711.80 to 1 worker

·    99p Stores Ltd, Northampton, neglected to pay £633.39 to 11 workers

·    Mr M & Mrs M Hargreaves, trading as Little Windrush, Solihull, neglected to pay £631.51 to 3 workers

·    Azad & Sons Ltd, trading as Pizza Hut, Norwich, neglected to pay £622.58 to 23 workers

·    The Bull’s Head (Inkberrow) Ltd, trading as The Bull’s Head Inn, Worcester, neglected to pay £580.95 to 3 workers

·    Glyn Harding, trading as GCH Transport, Frome, neglected to pay £485.87 to 1 worker

·    Mrs Yoko Banks, trading as Ashley House Hotel, Harrogate, neglected to pay £405.07 to 1 worker

·    Mr Daniel Smith, trading as Smith’s Hair, Braintree, neglected to pay £385.86 to 1 worker

·    Pharmacy 1st Ltd, Gillingham, neglected to pay £363.55 to 1 worker

·    Ms Sonia Duncton, trading as The Three Compasses Public House, Alford, neglected to pay £344.72 to 3 workers

·    Mrs Geraldine Kelly, trading as New Hope Creche, Enniskillen, neglected to pay £344.30 to 11 workers

·    Bounty (UK) Ltd, Welwyn Garden City, neglected to pay £284.26 to 1 worker

·    Golden Phoenix Inns Ltd, trading as The Crown Inn, Bristol, neglected to pay £284.01 to 1 worker

·    The Widd Group Ltd, trading as Widd Signs, Leeds, neglected to pay £253.50 to 1 worker

·    Mr Garry Evis, trading as Woodside MOT and Service Centre, Middlesbrough, neglected to pay £232.55 to 1 worker

·    Mr Keith J Pygall, trading Pygall Coaches, Peterlee, neglected to pay £198.34 to 1 worker

·    Ranc Care Homes Ltd, trading as Maidstone Care Centre, Ilford, neglected to pay £178.76 to 1 worker

·    Call & Deliver Ltd, trading as Pizza Hut, Heckmondwike, neglected to pay £163.45 to 9 workers

·    Mr Fernando Rocha, trading as A Tasca, Ely, neglected to pay £152.28 to 1 worker

·    Winners 2000 Fitness Ltd, Torquay, neglected to pay £130.78 to 1 worker

·    Central Electrical Ltd, Chesterfield, neglected to pay £130.28 to 1 worker

The report, Pay By The Rules, estimates that across the UK workers are losing £533million to employers who are ignoring the law. It highlights the negative impact on workers and law-abiding businesses as well as the failure of central government to tackle the problem.

The report shows that, in Newham alone:

17 per cent of working residents are paid below the NMW

£38.2million is underpaid to workers every year

Underpaid workers lose an average of £2,260 per annum

However, Government figures show that:

From 2009 to 2014, there has been a 60 per cent reduction in businesses inspected by NMW enforcement officers at HMRC

And since the start of this government only two prosecutions have been brought against criminal employers.

The report is backed by Rt. Hon. The Lord Andrew Adonis, Councillor Richard Watts, Leader of Islington Council, Councillor Jim McMahon, Local Government Association Labour Group Lead, and Leader of Oldham Council, Adam Chircop, Head of HR for ExCel  London, Nick Pearce, Director of IPPR, and John Burton, Westfield Director of Development and CIPD the professional body for HR and people development.

The report is being shared with Government, HMRC, and business representatives and it is hoped that as part of the localism agenda the next government will promptly devolve these powers to local authorities, who are best placed to support their local residents.

Mayor of Newham, Sir Robin Wales said: “This report clearly demonstrates that central government has been woefully inadequate at protecting workers from exploitative businesses who, in the majority of cases, are wilfully breaking the law.

Local authorities have the interests of their residents at heart, and are best placed to identify rogue businesses. We’re already aware of companies that flout licensing, planning, trading standards and waste rules and are able to take action. With additional powers to tackle underpayment of NMW, councils could make a substantial difference to residents’ lives. All we need is a government who are willing to act to improve the lives people nationwide.”

Paul Kenny, GMB General Secretary, said: "The national minimum wage is one of the most important workplace rights and more needs to be done to ensure all workers receive the pay to which they are entitled. Centralised enforcement is weak and currently fails to protect the lowest paid and most vulnerable.

GMB welcome Labour manifesto commitment to implement Newham's proposals for local authorities to be able to investigate and in turn prosecute employers who exploit their workers."

The report has also been endorsed by leading politicians and business leaders including Shadow Business Secretary Chuka Umunna MP, who said: “This report makes a powerful case for giving local authorities a greater role in enforcing the National Minimum Wage. If Labour is elected in May we will act, giving local authorities new powers to tackle rogue employers.

Under this government we’ve seen a failure to properly enforce the legal minimum and only a tiny number of prosecutions brought. As this report shows, there are real concerns that non payment is still far too commonplace.

Labour local authorities like Newham are leading the way in tackling low pay. Councils must be given the tools and powers they need to beef up local enforcement and make sure everyone at work gets paid what they are entitled to under the law.”

Contact: Gary Doolan 07852 182358 or Kamaljeet Jandu 07956 237178 or Martin Smith 07974 251722 or Cath Speight 07506 711925 or 07921 2898880.

To view the report visit: www.newham.gov.uk/paybytherules

Notes to editors

1 Ipsos MORI conducted the Newham Household Panel Survey in 2013, which found that 17 per cent of Newham residents who are in employment earn less than the minimum wage. underpayment. To estimate the annual underpayment residents’ most recent gross weekly pay and the number of hours they worked over a normal week was recorded.

2 National underpayment of £533m is calculated using the Newham average underpayment expressed over the estimated workers underpaid nationally (236,000).

3 Local government enforcement of the NMW can begin without the need for primary legislation, although to ensure local authorities can remain self-sufficient legislation would be required to increase the threshold of fines for criminal prosecutions.

4 New National Minimum Wage offenders named and shamed

Press release from Department for Business, Innovation & Skills and Jo Swinson MP dated 24 March 2015.

Business Minister Jo Swinson has named 48 employers who have failed to pay their workers the National Minimum Wage.

Between them, the companies named owe workers over £162,000 in arrears, and span sectors including fashion, publishing, hospitality, health and fitness, automotive, care, and retail.

This latest round brings the total number of companies named and shamed under the new regime to 210 employers, with total arrears of over £635,000 and total penalties of over £248,000.

Business Minister Jo Swinson said:

There’s no excuse for companies that don’t pay staff the wages they’re entitled to – whether by wilfully breaking the law, or making irresponsible mistakes.

The government is protecting workers by cracking down on employers who ignore minimum wage rules. In addition to naming and shaming, we’ve increased the penalty fines and boosted the resources available to investigate non-compliance.

The 48 employers named today (24 March 2015) are:

G1 Venues Ltd, trading as Arta Restaurant, Glasgow, neglected to pay £45,124.00 to 2895 workers

The Clothing Works Ltd (ceased trading), Corby, neglected to pay £17,007.08 to 38 workers

Freedom Sportsline Ltd, trading as Foot Locker, London, neglected to pay £16,718.25 to 601 workers

French Connection UK Ltd, London, neglected to pay £16,436.05 to 367 workers

Minara Enterprises Ltd, trading as Fakenham Tandoori, Fakenham, neglected to pay £11,696.47 to 1 worker

Sharon Makin, trading as Clever Clowns Day Nursery, Manchester, neglected to pay £10,572.08 to 6 workers

UK Gaming Computers Ltd, Colchester, neglected to pay £6,036.99 to 2 workers

Sarah Sloane and David Sloane, trading as Hawes Side Nursery, Blackpool, neglected to pay £2,825.58 to 3 workers

Weston Hire Services Ltd, Weston-super-Mare, neglected to pay £2,819.79 to 1 worker

Miss C Glendon & Miss S Glendon, trading as Ciara’s Tots Day Nursery, Manchester, neglected to pay £2,549.23 to 1 worker

Florence Opportunities Ltd, trading as Morgan Edward Hair & Beauty, Carmarthen, neglected to pay £2,201.99 to 1 worker

Champneys Springs Ltd, Swadlincote, neglected to pay £1,950 to 5 workers

H M Bodyshop Ltd, Colindale, London, neglected to pay £1944.83 to 1 worker

David Hayton Ltd, Penrith, neglected to pay £1,865.48 to 1 worker

Caledonian Leisure Sales Ltd, trading as Hurleys Operations, Birmingham, neglected to pay £1,628.63 to 1 worker

The Bell at Skenfrith Ltd, Skenfrith, neglected to pay £1,619.36 to 1 worker

Miss Kerris Dunne, Mr Frederick Dunne, and Mrs Alison Ashforth, trading as Aerobrights, Stafford, neglected to pay £1,529.82 to 6 workers

Mortgages First Ltd, Colchester, neglected to pay £1,475.63 to 3 workers

Fullworks (Ayrshire) Ltd, trading as The Full Works, Irvine, neglected to pay £1,362.76 to 2 workers

Crazy Divas Ltd, trading as Divas, Colchester, neglected to pay £1,316.74 to 4 workers

Glenview Development Partners Ltd, Tullibody, neglected to pay £1,150.42 to 1 worker

Toni & Guy (Wilmslow) Ltd, Wilmslow, neglected to pay £1,031.12 to 1 worker

Vertu Motors Plc, trading as Bristol Street Motors, Gateshead, neglected to pay £1,001.42 to 1 worker

PNP Media Ltd, trading as EBS Marketing, Manchester, neglected to pay £981.06 to 2 workers

Mr Trevor Trutwein, trading as Ambitions 2, Gillingham, neglected to pay £903.32 to 1 worker

Mr Anthony Miller, trading as Sportline Car Sales, Coalville, neglected to pay £779.70 to 2 workers

The Conde Nast Publications, London, neglected to pay £745.48 to 1 worker

Mr Yong Zhang, trading as Dragon Cottage Chinese Takeaway, Loughborough, neglected to pay £711.80 to 1 worker

99p Stores Ltd, Northampton, neglected to pay £633.39 to 11 workers

Mr M & Mrs M Hargreaves, trading as Little Windrush, Solihull, neglected to pay £631.51 to 3 workers

Azad & Sons Ltd, trading as Pizza Hut, Norwich, neglected to pay £622.58 to 23 workers

The Bull’s Head (Inkberrow) Ltd, trading as The Bull’s Head Inn, Worcester, neglected to pay £580.95 to 3 workers

Glyn Harding, trading as GCH Transport, Frome, neglected to pay £485.87 to 1 worker

Mrs Yoko Banks, trading as Ashley House Hotel, Harrogate, neglected to pay £405.07 to 1 worker

Mr Daniel Smith, trading as Smith’s Hair, Braintree, neglected to pay £385.86 to 1 worker

Pharmacy 1st Ltd, Gillingham, neglected to pay £363.55 to 1 worker

Ms Sonia Duncton, trading as The Three Compasses Public House, Alford, neglected to pay £344.72 to 3 workers

Mrs Geraldine Kelly, trading as New Hope Creche, Enniskillen, neglected to pay £344.30 to 11 workers

Bounty (UK) Ltd, Welwyn Garden City, neglected to pay £284.26 to 1 worker

Golden Phoenix Inns Ltd, trading as The Crown Inn, Bristol, neglected to pay £284.01 to 1 worker

The Widd Group Ltd, trading as Widd Signs, Leeds, neglected to pay £253.50 to 1 worker

Mr Garry Evis, trading as Woodside MOT and Service Centre, Middlesbrough, neglected to pay £232.55 to 1 worker

Mr Keith J Pygall, trading Pygall Coaches, Peterlee, neglected to pay £198.34 to 1 worker

Ranc Care Homes Ltd, trading as Maidstone Care Centre, Ilford, neglected to pay £178.76 to 1 worker

Call & Deliver Ltd, trading as Pizza Hut, Heckmondwike, neglected to pay £163.45 to 9 workers

Mr Fernando Rocha, trading as A Tasca, Ely, neglected to pay £152.28 to 1 worker

Winners 2000 Fitness Ltd, Torquay, neglected to pay £130.78 to 1 worker

Central Electrical Ltd, Chesterfield, neglected to pay £130.28 to 1 worker

The 48 cases named today were thoroughly investigated by HM Revenue and Customs (HMRC).

The scheme was revised in October 2013 to make it simpler to name and shame employers that do not comply with minimum wage rules.

If you have any questions about the National Minimum Wage (NMW) as a worker or as an employer please call Acas on 0300 123 1100.

Notes to editors

1.Employers have a duty to be aware of the different legal rates for the National Minimum Wage.

The current National Minimum Wage rates are:

adult rate (21 years and over) - £6.50 per hour

18 to 20-year olds - £5.13 per hour

16 to 17-year olds - £3.79 per hour

apprentice rate - £2.73 per hour

The apprentice rate applies to apprentices aged 16 to 18 years and those aged 19 years and over who are in their first year. All other apprentices are entitled to the National Minimum Wage rate for their age.

2.The government is committed to increasing compliance with minimum wage legislation and effective enforcement of it. Everyone who is entitled to the minimum wage should receive it. The Department for Business, Innovation and Skills (BIS) scheme to name employers who break minimum wage law came into effect on 1 January 2011. The scheme is one of a range of tools at the government’s disposal to tackle this issue. Employers who pay workers less than the minimum wage not only have to pay back arrears of wages at current minimum wage rates but also face financial penalties of up to £20,000. In the most serious cases employers can be prosecuted.

3.From 1 October 2013 the government revised the naming scheme to make it simpler to name and shame employers who break the law. Under this scheme the government will name all employers that have been issued with a Notice of Underpayment (NoU) unless employers meet one of the exceptional criteria or have arrears of £100 or less. All 48 cases named today failed to pay the National Minimum Wage and have arrears of over £100.

4.Employers have 28 days to appeal to Her Majesty’s Revenue and Customs (HMRC) against the NoU (this notice sets out the owed wages to be paid by the employer together with the penalty for not complying with minimum wage law). If the employer does not appeal or unsuccessfully appeals against this NoU, BIS will consider them for naming. The employer then has 14 days to make representations to BIS outlining whether they meet any of the exceptional criteria:

naming by BIS carries a risk of personal harm to an individual or their family

there are national security risks associated with naming in this instance

other factors which suggest that it would not be in the public interest to name the employer (employer to provide details)

If BIS does not receive any representations or the representations received are unsuccessful, the employer will be named via a BIS press release under this scheme.

5.Further information about the revised BIS NMW naming scheme can be found at Enforcing national minimum wage law

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Additional Resources

Newham London - Pay By The Rules

download pdf1947Kb (pdf) - 24 March 2015

Local Enforcement of the National Minimum Wage