Employers' worst excuses for not paying the minimum wage

Fifteen years since the introduction of the national minimum wage, HMRC shares the worst excuses employers have come out with when caught not meeting their responsibilities.

It has been fifteen years since the introduction of the national minimum wage. To mark the occasion, HM Revenue & Customs (HMRC) has revealed some of the elaborate (but poorly thought out) excuses given by employers who weren’t paying employees the minimum wage when challenged by the taxman's officers.

What are the current rules?

The Government introduced tougher rules on minimum wage enforcement last year, which include a new naming and shaming policy, and since 7th March 2014, a higher financial penalty of up to £20,000.

As it stands, the minimum wage for workers aged 21 and over is £6.31, for those aged 18-20 it falls to £5.03, and for the under 18s it stands at £3.72. Apprentices can be paid a minimum of £2.68. Read the historical rates here.

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The worst excuses

Ten of the worst reasons given in the last 12 months are:

• An employer said a woman on the premises was not entitled to the minimum wage as she was his wife. When asked what his wife’s name was, the employer said “err.. her name, err what’s your name love?..”

• An employer told HMRC: “I don’t think my workers know anything about the minimum wage because they don’t speak English.”

• Another employer told HMRC: “When the minimum wage goes up I do increase the amount I pay a little, even if the total pay is still below the minimum wage. I don’t think it's right to ignore the rises in the minimum wage.”

• A number of employers paying rates below the national minimum wage argued that accommodation they provided workers made up for the shortfall in wages.

• Upon inspection an employer told HMRC: “I know I am paying them too little, but they are happy to work for this amount because they are getting experience.”

• An employee claimed to be just working for a few days with a view to buying the business. When HMRC checked food safety records, the employee’s name was found on historic food temperature records.

• An employer claimed they realised they were not paying employees minimum wage and had just that week increased their wages… to an hourly rate which was still below the minimum wage.

• An employer told HMRC: “It wasn’t a conscious decision to say ‘I’m not going to pay this’, but I’ve never really considered doing it because I’ve not had people come to me and say, ‘I’m not getting paid enough’ or ‘Is this the minimum wage?’”

• An employee ran out of the premises when HMRC officers arrived to check for minimum wage infringements. The same employee then returned – minus the work pinafore – pretending to be a customer.

• Another employee claimed to be a friend of the owner and only in the restaurant as they were in the area. HMRC officers returned another day to find the person in the kitchen preparing food.

What to do if you're not being paid fairly

Last year HMRC’s investigations resulted in over 26,000 people getting a share of £4 million in back pay. 

Anyone who believes they are not being paid the national minimum wage can call the Pay and Work Rights Helpline, in confidence, for advice in over 100 languages on 0800 917 2368.

HMRC says that currently calls to the helpline from interns who are working for nothing, or for “expenses only”, are being fast-tracked to enforcement officers for investigation.

Use our MoneyTrack tool to keep on top of your finances.

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