HMRC penalties for employers who fail to pay NMW

From 7 March 2014, the financial penalty, calculated as a percentage of the total underpayment notice served on the employer by an NMW enforcement officer, has increased from 50% to 100%. The maximum penalty has increased from £5,000 to £20,000 (National Minimum Wage (Variation of Financial Penalty) Regulations 2014).

On 1 October 2013, the government launched a new “naming and shaming” policy for employers who fail to pay the NMW. The new policy is explained in the BIS report: The National Minimum Wage Policy on HM Revenue and Customs enforcement, prosecutions and naming employers who break national minimum wage law. To be named under the old rules, an employer had to owe at least £2,000 in total, with an average sum owed to each worker of at least £500. Under the new policy, these restrictions have been lifted.