A south-coast firm has hit back after being named as one of 70 employers that failed to pay workers the national minimum wage.
Department for Business, Innovation and Skills minister Jo Swinson (pictured) today published the names of companies failing to comply with the minimum wage requirement.
Among them was criminal firm Rowe Sparkes Solicitors Ltd, which was noted to have ‘neglected’ to pay £530.96 to a worker.
But the firm, which has offices in Portsmouth and Southampton, said it was acting legitimately and that the government has not even responded the firm’s offer to explain its case.
In a statement, solicitor Tim Sparkes said the firm had employed an apprentice under a one-year contract in December 2011 at a rate above the apprenticeship minimum.
The apprentice was signed off by her college in October 2012 but remained on the same contract after advice was taken from a human resources consultant about her status and pay rate.
But following an investigation, HM Revenue & Customs found the firm had under-paid the employee, leaving Rowe Sparkes with just the option of taking an appeal to the employment tribunal.
‘As an SME we decided on an economic basis to pay the amounts calculated by the HMRC,’ said Sparkes. ‘In doing so we made it clear that we in no way accepted HMRC’s determination.’
The solicitor added that the firm was notified on 3 February of BIS’s intention to publish its details and invited representations. Despite making representations the following day, the firm never received a reply.
The government has now named 162 employers since a new regime of exposing those in arrears came into force in October 2013.
In the latest round of employers named, between them, these 70 employers owed workers a total of more than £157,000 in arrears and have been charged financial penalties totalling more than £70,000.
Swinson said: ‘Paying less than the minimum wage is illegal, immoral and completely unacceptable.
‘Naming and shaming gives a clear warning to employers who ignore the rules, that they will face reputational consequences as well as financial penalties of up to £20,000 if they don’t pay the minimum wage.’
The 70 cases have been subject to investigation by HMRC, with one company – East Midlands Crossroads care provider – owing more than £37,000 to 184 workers.
Employers have a duty to be aware of the different legal rates for the national minimum wage, which are currently set at £6.50 per hour for adults over 21 and £5.13 per hour for 18 to 20-year-olds. For apprentices the hourly rate is £2.73 an hour.
Employers found to have broken the law are issued with a notice of underpayment and told they will be named.
Employers have 28 days to appeal to HMRC against the notice, and if they do not appeal or unsuccessfully appeal, BIS will consider them for naming.