Debenhams tops list of minimum wage offenders

Debenhams has topped an extensive list of businesses that underpaid its workers the national minimum or living wage.

The Department for Business, Energy and Industrial Strategy (BEIS) last night published a list of 360 businesses who underpaid its workers, with Debenhams named and shamed at the top of the list for failing to pay £134,894 to 11,858 of its workers

Meanwhile, fashion retailer Peacocks did not pay £2,256.58 to 42 workers.

The full list reveals how 15,520 workers were underpaid a total of £995,233, with employers in the hairdressing, hospitality and retail sectors the most prolific offenders.

In retail, 49 other employers alongside Debenhams and Peacock were named and shamed, with a total of £220,103 in back pay owed to 167 workers.

For the first time, the naming list also includes employers who failed to pay eligible workers at least the new Living Wage rate, which is £7.20 per hour for workers aged 25 and over.

READ MORE: “I thought it was ok to pay foreign workers below the NMW”: BEIS launches £1.7m campaign

As well as recovering arrears for some of the UK‘s lowest-paid workers, HMRC issued penalties worth around £800,000.

“Every worker in the UK is entitled to at least the national minimum or living wage and this government will ensure they get it,” Business Minister Margot James said.

“That is why we have named and shamed more than 350 employers who failed to pay the legal minimum, sending the clear message to employers that minimum wage abuses will not go unpunished.”

Debenhams said the issue related to a technical error in its payroll calculations, which led to an average underpayment of around £10 per affected colleague in 2015.

“As a responsible employer Debenhams is committed to the national minimum wage, and as soon as the error was identified by a routine HMRC audit last year, we reimbursed all those affected,” a Debenhams spokesperson said. 

“We have apologised to all our colleagues affected and have taken steps to ensure it cannot happen again.”

READ MORE: The National Living Wage & National Minimum Wage explained

A spokesman for Peacocks said: “Fundamentally we do not underpay our staff, they tell us that they prefer to receive a monthly salary based on the average hours they work rather than a fluctuating amount each month.

“This means their monthly pay is sometimes greater than the hours they have worked during that month, and on occasion, it is less. This is purely a timing issue based on the preferences of our employees and no one is underpaid over the year.”

The list comes weeks after the government launched a £1.7 million national minimum and living wage awareness-raising campaign, encouraging the UK‘s lowest paid workers to check they are being paid the correct rates and to report their employer if they are not. 

Since scheme was introduced by the BEIS in October 2013, more than 1000 employers have been named and shamed, with arrears totalling more than £4.5 million. More than £2 million in fines have been issued to national minimum and living wage offenders.

There are currently more than 1500 open cases which HMRC is investigating.

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