In the wake of last week’s increase in the National Minimum Wage, a study has shown that as many as 80% UK business owners are unaware that paying below the minimum wage is a criminal offence.
The research commissioned by the Department of Innovation and Skills and performed by Censuswide, found that 80% of 1,000 employers surveyed were unaware that they could be fined £20,000 per worker for failing to meet minimum wage requirements. 30% of those surveyed employed people on the minimum wage.
The national minimum wage was increased on the 1st October, but 74% of surveyed business owners were unaware of the new rates prior to the changes.
Furthermore, 53% didn’t know that it was a criminal offence to falsify pay records and some 64% said they didn't know they must pay underpaid workers the money they were rightfully owed.
The national minimum wage increase was announced during the Chancellor’s 2015 Budget address in July. Speaking at the time, Matthew Hancock, the then Minister for Business and Enterprise, told the BBC that it indicates the start of a “truly national [economic] recovery”.
For the majority of people in the UK, the minimum wage is now £6.70 per hour, following a rise of 3% - the biggest real-terms wage increase since the start of the financial crisis.
Although this didn’t reach George Osbourne’s initial target of £7 per hour, it did however exceed recommendations made by the Government’s Low Pay Commission at the time.
Apprentices have seen the biggest increase of 20% (50p per hour) to £3.30 per hour.
1.4m people expected to benefit from the changes.