Employment

These high street shops have been caught paying below minimum wage

One British chain was found to owe staff £1,000,000 in unpaid wages

The 202 companies in total will have to pay £7 million in fines. Image: mallsecrets/Flickr

Some of Britain’s most well-known household names have been caught paying their staff less than the legal minimum wage.

Over 60,000 people have been identified as having been underpaid, with 202 companies saving almost £5 million by dodging, or misinterpreting, the law. 

WH Smith, Argos and Marks & Spencer are some of the biggest brands to be named and shamed, with high inflation already putting immense pressure on the paypackets of those earning the least.

Stationary and convenience store WH Smith topped the list of shame, having failed to pay £1,000,000 to 17,607 members of staff. The retailer told the BBC it had misinterpreted the rules by asking staff to wear specific coloured clothing and shoes without reimbursement.

M&S failed to pay nearly £60,0000 to over 5,000 employees, while Argos, which is owned by Sainsbury’s, owed more than £480,000 pounds to 10,399 employees. 

A M&S spokesperson said that unintentional technical issues from over four years ago were to blame and the issue had been remedied, as reported by Reuters. 

“Our minimum hourly pay has never been below the national minimum wage, it is currently above it and no colleagues were ever underpaid because of this,” they said.

Argos also said that the underpayments were due to a technical payroll error, identified in 2018, that has been rectified. 

The 202 companies listed face penalties of nearly £7 million, according to the Department for Business and Trade.

“Whilst not all minimum wage underpayments are intentional, there is no excuse for underpaying workers,” said a department spokesperson in a statement.

Underpaying staff can also be called “wage theft” and is “a failure to pay a worker all that they are contractually owed for the labour power or the time that they have provided to an employer,” Nick Clark, research fellow at Middlesex University and principal investigator at Unpaid Britain, told the Big Issue last year. 

“You don’t have to steal a huge amount off a few people, you’re stealing a small amount off thousands on a regular basis. That’s where the millions are made,” he added. 

Deducting pay from workers’ wages and not paying them for their full hours worked were the most common ways employers on the government’s list underpaid their staff. 

One in five of the employers caught breaking the law paid the apprentices below the minimum rate – which is just £5.28 an hour. 

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Independent businesses including the historic Morleys department store, in Brixton, south London, and Blackpool Pleasure Beach Limited, also made the list of shame. 

“This relates to a small payroll oversight between the years of 2017 and 2019 involving 12 people, which has since been rectified,” a Blackpool Pleasure Beach spokesperson told the Big Issue.

A spokesperson for Morleys Stores Limited said the underpayment related to technical error in the “administration of staff dress code” and has been corrected.

The government increased the minimum wage by the highest ever rate from 1 April, though still below inflation. The national living wage, to be paid to workers aged 23 and over, currently stands at  £10.42 an hour, reducing to £10.18 for 21-22-year-olds,  £7.49 for 18-20-year-olds, and £5.28 for 16-17-year-olds.

Kevin Hollinrake, minister for enterprise, markets and small business, said the sanctions would send a clear message to those who ignore the law: “pay your staff properly or you’ll face the consequences.”

“Paying the legal minimum wage is non-negotiable and all businesses, whatever their size, should know better than to short-change hard-working staff,” he added.

All of the businesses named and shamed by the Department for Business and Trade, have “since paid back what they owe to their staff and have also faced financial penalties,” according to a government statement. 

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