Are employers obeying the law?
The short answer to the headline question is “Apparently not”.
According to the Low Pay Commission, 23% of employees aged 25 and over are paid less than the National Living Wage / National Minimum Wage. What’s more, one in 20 people surveyed said they don’t get the paid holiday they are entitled to. And almost one in ten don’t receive a payslip, even though that’s their legal right.
It seems that the highest risk is to young people, older workers, employees in small firms and people working in atypical ways – in all, maybe one million people could be affected.
Underpayment doesn’t only happen in small firms.
Betfred employs over 7,000 people in their 1,650 betting shops. They calculate holiday pay based on contracted hours, but without including overtime. That means that staff could be £££ out of pocket.
According to a whistle-blower, the company promised to notify staff in mid-August, but it appears this hasn’t yet happened – they are waiting for staff to make individual claims instead.
A Betfred spokesman said they are currently trying to bring their payroll system in line with Government guidelines.
What this means to you
Data is difficult to collect, so a three-year research project has been launched into enforcement of labour market laws, run by Resolution Foundation and Unbound Philanthropy. Meanwhile, the Government is consulting on combining its various enforcement agencies into one body.
If you’re an employer, it’s important that you treat your employees lawfully, especially in a labour market that’s becoming increasingly flexible, such as with the use of zero-hours contracts and the gig economy.
If you’re an employee, you need to know your rights, and what to do if your employer breaches them.
We act for both employers and employees (although not on the same case, as that would be a clear conflict of interest). Over 100,000 claims were made to the employment tribunal last year (not all by us, obviously)!
If you’d like to know more, please give us a call.