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A study has found that employers are cheating British workers out of at least £1.5bn a year in holiday pay and a further £1.2bn of wages for hours worked each year to which they are legally entitled.
It reported that 1 in 20 workers are not being given statutory holiday pay and 1 in 12 workers do not receive a payslip (which is required by law).
The report states that employers failing to pay basic wages is a widespread problem, but the weakness of enforcement means they can generally do so without punishment. This can have a serious impact on low paid workers.
To estimate the amount of deliberately unpaid work in the UK, the study used statistics or data from sources such as the Citizens Advice Bureau, the Labour Force Survey, the ACAS early conciliation service, employment tribunals and the Insolvency Service.
The employment sectors where workers’ wages were most likely not to be paid in full were in food and drink service, temporary agency working, personal services like dry cleaning and hairdressing, recreation and amusement activities and the hotel trade.
Comment
Barriers such as tribunal fees and legal aid cuts more often than not prevent workers recovering unpaid wages. Since the government introduced fees in 2013, the number of individual workers taking employers to tribunal has fallen by 67%. Even when workers win at tribunal, where employers fail to pay up, they may still have to pay the costs of enforcement orders and bailiffs.
Despite this, it is important employers ensure they pay workers both their holiday pay and their wages for the hours they work to prevent the risk of a claim being brought against them. This study shows that the matter is being looked at and, with heightened awareness, workers are more likely to initiate claims.
At Frettens, all of our solicitors offer a free initial meeting or chat on the phone to answer your questions. If this article raises issues for you or your business, please call us on 01202 499255 and Paul, Kate or Andrew will be happy to discuss it with you.
