National Minimum Wage

House of Lords written question – answered on 4th March 2014.

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Photo of Lord Beecham Lord Beecham Shadow Spokesperson (Communities and Local Government), Shadow Spokesperson (Justice)

To ask Her Majesty’s Government whether, in the light of the HM Revenue & Customs report, National Minimum Wage compliance in the social care sector, they will update their evaluation of national minimum wage compliance; and whether they will encourage and monitor the payment of the living wage in the social care sector.

To ask Her Majesty’s Government what steps they are taking to enforce and monitor national minimum wage enforcement in the social care sector in the light of the evaluation published by HM Revenue and Customs in November 2013; and what extra resources have been made available for that purpose.

To ask Her Majesty’s Government what discussions have been held with the Local Government Association about the possible role of local authorities in enforcing minimum wage legislation in relation to social care and generally; and with what result.

Photo of Viscount Younger of Leckie Viscount Younger of Leckie The Parliamentary Under-Secretary of State for Business, Innovation and Skills

The Government is committed to increasing compliance with minimum wage legislation and the effective enforcement of it, including in the social care sector. Everyone who is entitled to the minimum wage should receive it.

The Government has a central enforcement body dedicated to the National Minimum Wage (NMW). HM Revenue and Customs covers all areas of the UK, which ensures a consistent approach, a high quality service and a brand that everyone recognises.

HMRC investigates every complaint made to the Pay and Work Rights helpline. In addition, HMRC conducts risk-based enforcement in sectors or areas where there is a higher risk of workers not getting paid the legal minimum wage. One of the sectors in which HMRC carries out risk based enforcement is the social care sector.

The Government is also taking specific action to improve compliance with national minimum wage legislation in the social care sector. The Department of Health is developing statutory guidance for local authorities which refers to employment law and the Department for Business, Innovation and Skills (BIS) guidance on payment of travel time. This will enable local authorities to assure themselves that the care companies they contract with comply with NMW regulations. This guidance should be available in the Autumn.

BIS is also working with HMRC to identify the communication action necessary to promote the useful information for workers and employers contained in HMRC’s evaluation report on the social care sector. It is also considering the next steps to increase compliance in this sector.

The Government supports businesses that choose to pay a higher wage when it is affordable and not at the expense of jobs. The decision to pay employees above National Minimum Wage is for employers and their workers and the Government will not be monitoring this. Consequently, the government does not intend to monitor the payment of the living wage.

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