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Employers face higher fines for underpaying workers

Posted: 12th February 2014   In: Business Employment

The government is set to increase fines for employers who fail to pay their employees the National Minimum Wage (NMW).

Currently businesses can be ordered to reimburse workers who have received less than the minimum wage. They can also be fined 50% of the total amount of underpayment for all their employees, up to a maximum of £5,000.

Now the fine is to rise to 100% of the amount underpaid, up to a maximum of £20,000.

Business Secretary Vince Cable said: “Anyone entitled to the National Minimum Wage should receive it. Paying anything less than this is unacceptable, illegal and will be punished by law. So we are bringing in tougher financial penalties to crack down on those who do not play by the rules. The message is clear – if you break the law, you will face action.”

The new measures are due to come into force in February 2014, subject to parliamentary approval.