The Department for Business and Trade (DBT) recently released its nineteenth ‘name and shame’ list, revealing 202 employers who failed to comply with the National Minimum Wage (NMW) regulations. These employers, spanning investigations from 2017 to 2019, were collectively ordered to repay nearly £5 million to their lowest paid staff and faced penalties totalling almost £7 million. The breaches affected a staggering 63,000 workers, underscoring the significance of adhering to NMW requirements.

Non-compliance with the NMW can have severe consequences. Penalties can amount to 200% of the underpayment, and the reputational damage of being publicly named by the DBT is substantial. Every employer, regardless of size, is obligated to pay their workers at least the NMW.

With an increased emphasis on enforcing NMW regulations, accompanied by a rise in the number of enforcement officers, employers face greater pressure than ever to comply. HMRC actively encourages employees who suspect they have been underpaid to come forward, assuring them of anonymity during investigations. It’s important to note that HMRC can review pay records up to six years back, allowing former employees to complain about historic underpayment.

Prominent brands like WH Smith, Argos, and Marks & Spencer found themselves on the most recent list. These companies swiftly responded to the media by asserting that their breaches were unintentional and had been promptly rectified. Argos attributed its inclusion to a “payroll error,” while Marks & Spencer claimed it was an “unintentional technical error.”

Acknowledging that some underpayments can be accidental, as echoed by the DBT and the named employers themselves, we present several pointers to help ensure compliance:

1. Deductions from wages:

Common deductions such as uniform costs, till shortages, pension salary sacrifice, meals, and parking permits can potentially reduce a worker’s pay below the NMW. To avoid this, employers can spread the deduction over multiple pay periods to ensure the pay remains above the NMW.

A similar rule applies where an employer requires staff to purchase uniform items from them (or a third party) and does not reimburse them for those costs.

This is the rule that caused issues for WH Smith, the worst offender in the most recent DBT list.  WH Smith commented it had misinterpreted rules around uniforms and had asked staff “to wear specific-coloured trousers, skirts and shoes without reimbursing them for these costs. This was remedied in 2019, once the mistake was brought to its attention”.

2. Inaccurate working time records:

Accurate payment hinges on precise records of hours worked. Failing to capture a worker’s complete working time, such as travel between jobs, changing out of PPE or time spent on security checks, can lead to underpayment.

3. Training time and shadow shifts:

Some employers mistakenly assume that training time or shadow shifts are non-working hours. In reality, workers must be paid at least the NMW for these activities, as well as for meetings or handover periods.  This equally applies to meetings arranged at the start or end of a shift or handover periods.

4. Failure to pay the correct NMW rate to apprentices:

Apprentices on recognised schemes or contracts are entitled to the NMW at apprenticeship rate. Employers must provide structured training, and apprentices aged 19 or over, after completing their first year, must receive at least the NMW for their age group. Time spent studying or training, even outside regular working hours or at home, should be compensated.

5. Failure to increase the NMW when rates change:

Different NMW rates apply based on a worker’s age and these typically change in April each year. Employers must review and apply the uprated rate promptly on a worker’s birthday, starting from the first pay reference period thereafter.


Compliance with the NMW is crucial to avoid financial penalties and reputational harm.  Furthermore, paying at least the minimum wage is of utmost importance from an employee welfare perspective. It ensures that workers receive fair compensation for their labour, allowing them to meet their basic needs and maintain a decent standard of living and financial stability and is a way for employers to demonstrate their commitment to the welfare and dignity of their workforce, ultimately creating a more inclusive and equitable society.

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Hannah Powell