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A
slew of UK firms have developed elaborate scams to avoid paying staff the
national minimum wage, a new report suggests. Common ruses include charging
workers for uniforms, exploiting interns and clocking-off staff in the absence
of customers.
Research
carried out by the Trade Union Congress (TUC) reveals apprentices in training
are most at risk of underpayment. An estimated 120,000 apprentices in the UK
are thought to receive less than the minimum wage, the body warns.
The
TUC’s report, published on Thursday, identified other groups of staff
vulnerable to underpayment. Such workers span zero-hours contracts staff,
domestic and migrant workers, social care workers, staff whose accommodation is
included in their contract, interns, seafarers and others.
TUC
General Secretary Frances O’Grady warned firms’ failure to pay the minimum wage
“is an antisocial act”
that financially cripples workers who have very little.
“There
should be no hiding place for cheapskate bosses who try to cheat their workers
out of the minimum wage,” she said.
While
Britain has seen some improvements in how the statutory pay rate is enforced,
employers have devised new ways to cheat the system, TUC research shows.
The
damning research uncovered a percentage of employers who weren’t documenting
staff hours correctly, not issuing employees adequate travel expenses where
required, or simply changing their name to avoid penalty fines.
The
TUC is calling upon the government to improve its enforcement of the minimum
wage to tackle rogue bosses and managers.
At
present, firms who fail to pay workers the national minimum wage face few
repercussions beyond a paltry fine of £5,000.
The
trade union federation is demanding more stringent deterrents, including a
heftier fine of £75,000, the hiring of greater numbers of enforcement officers
and the naming and shaming of firms that refuse to comply with the state’s
minimum wage laws.
The
UK’s minimum wage for adults increased marginally from £6.31 per hour to £6.50
in October 2014. For those aged 18 to 20, however, it stands at a mere £5.13.
It
contrasts sharply with the UK’s ‘living wage’ of £9.15 an hour in London, and
£7.85 an hour in the rest of the UK.
The
living wage is a baseline salary considered vital to providing an adequate
standard of living in Britain. It’s paid by companies voluntarily, and is
backed by all major political parties and Prime Minister David Cameron.
Despite
October’s marginal increase in the minimum wage, the number of British people
living in absolute poverty is 300,000 higher than previously thought, according
to a study for the Joseph Rowntree Foundation (JRF).
The
report, by the New Policy Institute, was published in November. The research
analyzed the relationship between poverty and the cost of living.
It
revealed that big increases in food and energy prices mean poorer households
experience larger increases in their living costs than their wealthier
counterparts.
O’Grady
said it’s clear certain employers are actively seeking new ways to flout their
legal obligation to pay the minimum wage.
“We
must engage in a constant battle to ensure that every worker gets at least the
minimum,” she said.
“There
should be a broad consensus between political parties, good employers and trade
unions that the minimum wage must always be enforced effectively.”
With
wages expected to be a prominent issue throughout the general election battle,
a potential shift in the national minimum wage to £7 by low pay commissioners
may emerge.
Labour has vowed to ramp up
the rate to £8 an hour during the next parliament should it win on May 15.
Conservative Chancellor for the Exchequer George Osborne, however, has issued a
more moderate pledge of raising it to £7 if the UK’s economy improves.
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