18 December 2018
The government has released its response to the Labour Market Enforcement Strategy recommendations which were published in May 2018. The response accepts many of the recommendations, including a package of measures designed to crack down on employers who deliberately exploit or underpay their workers.
It’s encouraging to see the government calling the enforcement agencies to provide more support for ‘good employers’
Hilary Hall, NHF/NBF chief executive said, “It’s encouraging to see the government calling the enforcement agencies to provide more support for ‘good employers’, especially those who have asked for advice to ensure they comply with the law. The report promises improved guidance on the National Minimum Wage/National Living Wage (NMW/NLW), particularly for problem areas such as pay averaging.”
The naming and shaming scheme will include the average arrears per worker for each named employer, and case studies will be provided to raise awareness of the reasons for under-payment within specific sectors.
To give greater transparency on rates of pay, it has already been announced that legislation will come into effect in April 2019 requiring payslips to be provided for all workers and, for hourly paid workers, payslips must include the total hours worked and the hourly rate of pay.
Other measures include legislation to:
- Give new powers to HMRC to enforce holiday pay and recover holiday pay arrears.
- Require employers to provide a statement of principal rights for workers on day one of starting employment.
- Tackle ‘phoenixing’ where directors dissolve companies to avoid paying penalties and to improve the chances of workers being paid what they are owed.
The government has partially rejected a recommendation from the Labour Market Strategy to pilot a licensing scheme to tackle modern slavery in nail bars. Instead, the Gangmasters and Labour Abuse Authority (GLAA) will carry out a scoping exercise, likely to be in Greater Manchester, to measure the ‘scale, nature and threat of modern slavery in nail bars’ and whether a licensing scheme would help to stamp out organised crime groups who exploit workers with threats, debt bondage and withhold travel documents to control workers.