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HMRC internal manual

Debt Management and Banking Manual

From
HM Revenue & Customs
Updated
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Debt and return pursuit: miscellaneous charges: National Minimum Wage Penalties (NMWP): penalty appeals and reductions

Penalty appeals

The penalty becomes due 30 days after the date of issue of the notice of penalty. This date incorporates 2 days for service of the penalty notice excluding weekends and bank holidays unless served by hand.

An employer has a 28 day right of appeal to an Employment Tribunal (Industrial Tribunal in Northern Ireland) against the issue of a Notice of Underpayment (this notice includes the penalty charge).

Appeal received

If an appeal is received the penalty will be suspended on SAFE.

No appeal

However if no appeal is received and if the penalty is still outstanding 31 days after the due date SAFE will issue payment reminder and then the penalty will move to IDMS for pursuit.

Appeal received locally

If you receive an appeal against a penalty refer to the NMW Compliance Team for advice.

Penalty reductions for prompt payment

The employer can reduce the amount of the penalty he has to pay by paying promptly within 14 days of the date of service of the notice (counting the date of service as day 1). There are two conditions which must be met by that date: the employer must pay

  • all the workers their full arrears as shown on the notice and
  • half the amount of the penalty, so for example if the penalty was £100, the employer has to pay £50 by the specified date.

If the employer complies with both of these conditions the NMW Compliance team will discharge the balance of the penalty.

If the employer fails to comply with either or both of these conditions, then the full amount of the penalty is automatically due.

Dishonoured cheques

If you become aware that the penalty has been paid by cheque and later dishonours advise the NMW Compliance Team immediately so that they can check to see if any reductions have been made to the penalty charge and where appropriate cancel the discharge.