In a major enforcement action, nearly 500 UK employers have been publicly named for failing to pay the National Minimum Wage (NMW) triggering over £10.2 million in fines and securing £6 million in reimbursements to approximately 42,000 workers. 

Rising Stakes for Compliance

The government’s announcement came as part of its sweeping Plan for Change, introduced as the most significant overhaul to workers’ rights in a generation. The push includes establishing a new Fair Work Agency to clamp down on employers who short statute obligations such as holiday pay, sick pay, and wage compliance.

Business Secretary Peter Kyle emphasised, “Every worker deserves a fair day’s pay for a fair day’s work, and this government will not tolerate rogue employers who short-change their staff.”

Employment Rights Minister Kate Dearden added that under the forthcoming Employment Rights Bill, enforcement powers will be bolstered to protect workers more effectively.

Concerns for Payroll

Behind the headlines, payroll professionals are raising concerns about the increasingly complex nature of NMW compliance.

Jason Davenport, CEO of the Chartered Institute of Payroll Professionals (CIPP), commented, "It’s imperative for pay professionals to be aware of the nuances to National Minimum Wage, to ensure compliant calculation and payment of eligible workers’ pay. The most common downfalls to this complex area of legislation take place in the form of the incorrect rate being paid to apprentices, and unpaid working time.”

Davenport also highlighted a rising issue: that certain employee benefits and salary sacrifice arrangements can unintentionally reduce take-home pay below the NMW threshold, even when base salaries appear compliant.

“Our members have raised concerns of NMW increases and their impact on pay differentials and salary sacrifice arrangements. In some cases, benefits such as cycle-to-work schemes or pensions, while valuable, can cause a breach in compliance if not carefully monitored.”

He called for clearer government guidance and simpler legislation to help avoid these unintended errors, stressing that many employers falling short aren’t acting maliciously, but rather struggling with technical complexity. “The CIPP supports pay professions to remain compliant, and to do everything they can to stay off these very publications.”

What Employers Should Do Now:

• Audit your pay structures, check for compliance post-deductions and across all roles
• Review apprentice pay policies, especially on age thresholds and training requirements
• Scrutinise salary sacrifice schemes  - ensure deductions don’t bring pay below legal minimums
• Track all working time — including prep, travel, and waiting time often overlooked
• Stay informed on legislation — new enforcement bodies and rules are on the way
• Educate payroll teams — as compliance increasingly relies on technical expertise

With public naming more frequent and enforcement tougher, the cost of non-compliance is dramatic to reputation and operations. As this latest campaign proves, even a small mistake can land an organisation in the spotlight.