Issuing notices of underpayment: enforcement policy
National minimum wage enforcement policy underpins national minimum wage legislation (NMWM01030). It aims to:
- encourage employers to voluntarily comply, so that workers are paid their legal entitlement at the right time;
- change the behaviour of employers by deterring potential non compliance;
- protect vulnerable workers by penalising employers who fail to pay the national minimum wage on time;
- ensure workers who are not paid on time receive arrears which take into account the length of time they have been underpaid;
- prevent employers gaining a competitive advantage over other businesses by unlawfully depressing workers’ pay;
- demonstrate to the business community that non compliance with national minimum wage legislation is unacceptable.
- sets out when a notice of underpayment should be issued (NMWM13030) and when this should penalise non compliant employers by imposing a penalty (NMWM13180);
- establishes a civil enforcement regime if arrears and/or penalties remain outstanding;
- makes provision for criminal prosecutions for the more serious cases of non compliance.
The Policy on HM Revenue & Customs enforcement and prosecutions is published by the Department for Business, Innovation & Skills (NMWM02020) and can be found on GOV.UK.
Prior to 6 April 2009, enforcement notices and penalty notices were issued to enforce payment of national minimum wage arrears (NMWM13320).