Another 92 companies have been added to the HMRC’s name and shame campaign for National Minimum Wage (NMW) non-compliance. Since the campaign was introduced back in 2013, nearly 500 companies have been named and shamed with over £3 million in arrears and £1.1 million in penalties. But what should businesses be doing to ensure they are not at risk of being the next on the list.
Andy Jones, our MD, recommends a full payroll audit before HMRC do it for you. ‘It’s essential all businesses run a full audit to ensure they are compliant. We’ve seen a wide range of businesses caught by the HMRC, from small family run SME’s right up to large Corporations. These errors are avoidable – any errors found now can be corrected keeping HMRC and importantly your employees happy.’
What considerations should you be making if you are auditing your payroll for National Minimum Wage compliance?
1 – What counts as working time?
Did you know that if you require employees to be at work 15 minutes before their shift starts this counts at working time and should be included in NMW calculations.
2 – Keep records to prove you are paying National Minimum Wage
HMRC will look back for upto 3 years to ensure compliance. Make sure you have the relevant records to prove hours work and corresponding wages paid.
3 – Be careful if you are offering deductions on wages.
For example if employees are deducted a payment for uniform that isn’t refunded.
4 – Check your salaried workers
Are you salaried workers working more hours at no extra pay? Salaried workers can sometimes be the easiest to overlook.
5 – Review your processes for ongoing assessment of National Minimum Wage compliance?
Think about monitoring age changes, changes to contracted hours, assessment of unpaid overtime. Automated is key to continued success.
If you want to protect yourself from National Minimum Wage non-compliance speak to CE Back Office and find out how outsourcing your payroll will ensure your business is kept in line with the changing legislation. Send me a message for a free no obligation consultation or call 01270 899112.
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