Asked by: Stephanie Peacock (Labour - Barnsley South)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, when she plans to (a) publish a response to the consultation on tips, gratuities, cover and service charges which closed on 27 June 2016 and (b) bring forward legislative proposals on service charges.
Answered by Kelly Tolhurst
Through the Good Work Plan we have committed to legislate on a range of areas to enhance workers’ rights, including to ensure that all tips left to workers go to them in full.
We expect over a million workers to benefit, many of whom are in low-paid jobs. Consumers will have reassurance that the money they leave in good faith is going to the staff, as they intended.
The Good Work Plan set out an ambitious programme to take forward the vast majority of the recommendations made in the Taylor Review. We have already implemented key commitments, through secondary legislation to increase workers’ rights and protections, and improve transparency for workers, from day one. We will bring forward further measures when Parliamentary time allows.
Asked by: Stephanie Peacock (Labour - Barnsley South)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, pursuant to the Answer of 11 June 2019 to Question 261273, what the outcomes of the HMRC investigations that were completed but did not result in employers being found non-compliant were.
Answered by Kelly Tolhurst
HMRC may open an investigation into an employer’s compliance with National Minimum Wage law either following a worker complaint or via proactive risk-based enforcement activity. Where HMRC find no minimum wage arrears are due, they will not take enforcement action such as issuing a Notice of Underpayment and financial penalty.
Where HMRC find that arrears are due to workers they will generally issue a Notice of Underpayment and financial penalty. In some cases, employers may be allowed to carry out self-correction action which ensures that workers are paid the money due to them without the issue of a Notice of Underpayment. Overall, in 2018/19 HMRC found arrears in 45% of cases they closed; this “strike rate” has increased year-on year since the introduction of the National Living Wage in 2016.
This information will be covered in more detail in BEIS’ Minimum Wage Enforcement and Compliance report, which we will publish in due course.
Asked by: Stephanie Peacock (Labour - Barnsley South)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, pursuant to the Answer of 17 June 2019 to Question 263213 on Conditions of Employment, whether the employers subject to labour market enforcement undertakings for non-payment of the national minimum wage will be considered for naming when the National Minimum Wage Naming Scheme resumes.
Answered by Kelly Tolhurst
Enforcement of the National Minimum Wage (NMW) is a priority for the Government. We have more than doubled the budget for NMW compliance and enforcement since 2015, to a record high of £27.4 million. The 2018/19 financial year was a record year for NMW enforcement; HMRC identified £24.4 million in arrears across 3,018 cases – a record number since the introduction of the National Living Wage in 2016.
In line with the published NMW enforcement policy, any employer who have been issued a Notice of Underpayment resulting from a breach of National Minimum Wage law will be considered for naming under the National Minimum Wage Naming Scheme.
This applies regardless of whether the employer is also subject to a Labour Market Enforcement Undertaking or Order.
Asked by: Stephanie Peacock (Labour - Barnsley South)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, pursuant to the Answer of 10 June 2019 to Question 260713 on Minimum Wage, whether the Director of Labour Market Enforcement recommended that the naming of non-compliant employers be suspended for the duration of the review of the National Minimum Wage Naming Scheme.
Answered by Kelly Tolhurst
The Government remains committed to enforcing the National Minimum Wage (NMW). We have more than doubled HMRC’s budget for NMW compliance and enforcement since 2015 to £27.4 million for 2019/20.
The Director of Labour Market Enforcement recommended evaluation of the National Minimum Wage Naming Scheme in his 2018/19 Strategy. The Director’s consultation revealed mixed views from stakeholders about naming; some were strongly supportive, whilst others proposed ideas for increasing its effectiveness as a deterrent to underpayment of the minimum wage.
The Government decided to pause the naming of non-compliant employers while we determine what changes are needed to make sure the scheme continues to have resonance and acts as a tool to drive compliance.
Asked by: Stephanie Peacock (Labour - Barnsley South)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, pursuant to the Answer of 12 June to Question 260712, whether his Department has begun drafting the proposals for consultation on a single labour market enforcement body; how many civil servants will be allocated to work on those proposals; and whether the consultation will open before 22 July 2019.
Answered by Kelly Tolhurst
Government is committed to improving state enforcement of employment rights as part of the Good Work Plan. Work to develop proposals on the establishment of a single labour market enforcement body is underway and we will publish a consultation in due course.
These proposals are being developed by a number of civil servants, including policy experts, analysts and lawyers in the Department and I will continue to ensure that this work is adequately resourced as the project progresses. Given that this work touches on a wide range of policy areas, we have also received input and support from civil servants across Whitehall and from the existing enforcement bodies.
Asked by: Stephanie Peacock (Labour - Barnsley South)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, how many times Ministers of his Department have met the Director of Labour Market Enforcement to discuss the National Minimum Wage Naming Scheme since 6 July 2018.
Answered by Kelly Tolhurst
Ministers from the Department for Business Energy and Industrial Strategy take regular advice from the Director of Labour Market Enforcement (DLME), and most recently met with him in October to discuss the Government response to his 2018/19 Labour Market Enforcement Strategy.
The review of the NMW Naming Scheme will draw upon evidence from a wide range of internal and external sources. Officials have discussed the evidence with the DLME and the Government has also sought to learn from other naming schemes and regulatory approaches.
In April 2019 the Government received the report “Non-Compliance and Enforcement of the NMW” from the independent and expert Low Pay Commission. This report summarised consultation responses they had received relating to the operation of the NMW Naming Scheme.
We are in the process of concluding the review and will publish any resulting effects on the operation of the Naming Scheme through the NMW Enforcement policy documents.
Asked by: Stephanie Peacock (Labour - Barnsley South)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, pursuant to the Answer of 10 June 2019 to Question 260713 on Minimum Wage, what further evidence he plans to collate as part of his review of the National Minimum Wage Naming Scheme; and what public consultation he plans to undertake during that review.
Answered by Kelly Tolhurst
Ministers from the Department for Business Energy and Industrial Strategy take regular advice from the Director of Labour Market Enforcement (DLME), and most recently met with him in October to discuss the Government response to his 2018/19 Labour Market Enforcement Strategy.
The review of the NMW Naming Scheme will draw upon evidence from a wide range of internal and external sources. Officials have discussed the evidence with the DLME and the Government has also sought to learn from other naming schemes and regulatory approaches.
In April 2019 the Government received the report “Non-Compliance and Enforcement of the NMW” from the independent and expert Low Pay Commission. This report summarised consultation responses they had received relating to the operation of the NMW Naming Scheme.
We are in the process of concluding the review and will publish any resulting effects on the operation of the Naming Scheme through the NMW Enforcement policy documents.
Asked by: Stephanie Peacock (Labour - Barnsley South)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, pursuant to the Answer of 10 June 2019 to Question 260093, on what dates each labour market enforcement undertaking was applied; to which employers such undertakings were applied; and on the basis of what trigger offence in each case.
Answered by Kelly Tolhurst
The Immigration Act 2016 introduced the provision for three labour market enforcement bodies to serve labour market enforcement undertakings (LMEU) and orders (LMEO): the Employment Agency Standards (EAS) Inspectorate, the Gangmasters and Labour Abuse Authority (GLAA) and Her Majesty’s Revenue and Customs – National Minimum Wage Team (HMRC – NMW).
To date, no prosecution has resulted from breaching a labour market enforcement undertaking or order.
Each enforcement body has a different legal framework for the disclosure of information related to LMEUs. Both EAS and HMRC – NMW cannot disclose the name of the employers or the nature of the offences without informed consent from the employers involved as this would be in breach of their respective customer confidentiality clauses. Section 9 of the Employment Agency Act precludes EAS from publishing the name or details of enforcement action without the permission of the employment business or agencies involved. Section 18 of the Commissioners for Revenue and Customs Act (CRCA) 2005 precludes HMRC from disclosing/sharing information about an individual or taxpayer to a third party.
The GLAA routinely discloses the dates and the type of trigger offences for which its LMEUs are served. Whilst the Gangmasters (Licensing) Act 2004 does not preclude the GLAA from disclosing the names of the recipients of LMEUs, the GLAA does not deem appropriate to release their identity. Identity disclosure would defeat the purpose of LMEUs which are a voluntary agreement meant to be a proportionate sanction to encourage compliant behaviour from the recipient.
The table below displays the information that could be disclosed by the three enforcement bodies:
Enforcement Body | Number of LMEU served | Date of commencement | Trigger offence |
EAS | 4 | 04/04/18 | Not disclosed |
1 | 03/04/18 | Not disclosed | |
GLAA | 1 | 20/03/18 | All these LMEUs have been issued for trigger offences under section 12 and 13 of the Gangmasters Licensing Act 2004 which respectively refer to acting as an unlicensed gangmaster and using labour supplied by an unlicensed gangmaster. |
1 | 22/05/18 | ||
1 | 21/06/18 | ||
1 | 13/07/18 | ||
1 | 23/07/18 | ||
1 | 16/08/18 | ||
3 | 21/08/18 | ||
1 | 31/12/18 | ||
4 | 15/04/19 | ||
1 | 26/04/19 | ||
HMRC - NMW | 1 | 19/06/18 | Not disclosed |
1 | 27/06/18 | Not disclosed | |
1 | 21/08/18 | Not disclosed | |
1 | 05/11/18 | Not disclosed | |
1 | 22/10/18 | Not disclosed | |
1 | 30/10/18 | Not disclosed | |
1 | 16/11/18 | Not disclosed | |
1 | 07/03/19 | Not disclosed | |
| Total: 28 |
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