HMRC's own inspections show nearly half of care companies are failing to pay the minimum wage. Yet the government are refusing to name and shame them. Why?
The government have named-and-shamed the latest batch of employers who have failed to pay the minimum wage. But there are some glaring omissions – including some very large companies indeed…
There were 233 employers listed in total. Yet despite evidence of widespread minimum-wage dodging in the sector, they have named just 14 social care providers – and, like last year, they are all small local companies.
In six of the 14 cases, they have only identified arrears for one worker, and just a handful more in the other instances. The average amount of arrears per worker is £475.
Yet we know the scale of minimum-wage dodging in the care industry. Research from the Resolution Foundation shows that over 160,000 care workers are cheated of £130m in wages every year. That’s an average of £815 per worker.
And at the end of last month, Norman Lamb revealed this shocking fact from HMRC itself: their own investigations against care providers showed 43% of inspections identified non-compliance with the minimum wage. One of the companies had cheated workers out of more than £1m in pay:
In Commons y’day, I exposed shocking findings of HMRC investigation I initiated as minister – £2.5m under-payment of min wage in social care pic.twitter.com/uMlSTvSTnA
— Norman Lamb (@normanlamb) June 30, 2017
UNISON National Officer Matt Egan said:
“The government’s position on enforcing the minimum wage in the care sector is really muddled. After they finally started to take action against care employers over the sleep-in issue, they were quick to fold after the care sector’s slick campaign saying that it would lead to them all going out of business – so they announced a suspension of enforcement activity.
“And again, they will not come out and name and shame any of the large providers as part of this exercise.
“They are clearly worried about market failure in the care sector and so don’t want to push providers too hard, which means that significant numbers of our members and the wider workforce will continue to be exploited through sub-minimum wage pay.”
Rebecca Long Bailey, Shadow Secretary for Business, Energy and Industrial Strategy, told Left Foot Forward:
“It is terrible that social care providers pay their employees below the national minimum wage. However, the figures released by the HMRC only touch upon deeper problem, with non-payment being far wider than the official figures indicate.
“The Government must do more to enforce NMW across all sectors and to accurately report on how each sector is doing in terms of NMW payment.”
Since BIS began naming and shaming employers for non-compliance with the NMW in 2014, just £240,000 in arrears have been identified in the care sector, for 1179 workers. There were 84 employers, and in 47 of those, HMRC publicly said arrears were owed to just one worker.
Why is the government so afraid to name and shame the big care companies? As Matt Egan notes, it’s almost like they’re scared people will realise the market in care isn’t working…
Josiah Mortimer is Editor of Left Foot Forward. Follow him on Twitter.
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