Hotel firm owed workers Â£17,000, Government list reveals
A company which runs a plush country hotel failed to pay workers more than Â£17,000 which they were owed.
The Department for Business, Energy and Industrial Strategy (BEIS) today named 260 employers nationwide for failing to pay 16,000 workers at least minimum wage rates.
Government investigators identified £1.7million in back pay for some of the country’s lowest paid workers and fined employers £1.3 million for underpayment.
Retail, hairdressing and hospitality businesses were among the most prolific offenders in this round.
Common reasons for errors made include: failing to pay workers travelling between jobs, deducting money from pay for uniforms and not paying for overtime.
Ramside Estates Limited, which runs Ramside Hall Hotel on the outskirts of Durham City, is one of the businesses named after it failed to pay a total of £17,536.59 to eight workers.
Bosses at Ramside Estates said that the issue related to a problem with a clocking in machine.
John Adamson, from the company, said: “Ramside Estates has been in business for 54 years and is one of the longest standing hospitality businesses in the North East.
“We have always paid our staff the minimum wage and above and unfortunately this particular situation arose because of an issue with the clocking in machine, where chefs who were on split shifts – with a four hour break in the middle of the day – appeared as if they were working through for 12 hours.
“Because of that it seemed as if their hourly rate was below the minimum wage, which in reality was not the case.
“We pointed this out to the inspectors but they did not accept our explanation.
“To ensure this situation does not arise again, our contracts of employment now allow people who work more than a 48-hour week to be reimbursed, although this is challenging for the hospitality industry where long hours have always been the norm.
“It does seem that the hospitality industry is being particularly targeted and that we are being made a scapegoat in this instance.”
Other firms highlighted include Sports Direct, run by Newcastle United owner Mike Ashley, which failed to pay £167,036.24 to 383 workers and fashion retailer Primark, which owed £231,973.12 to 9,735 workers.
Two Sunderland care companies, Blue Ribbon Community Care and Bluebird Care, were also mentioned on the list.
Blue Ribbon failed to pay failed to pay £2,789.06 to 22 workers, with a company spokesman telling the Echo: “Our rate of pay has always been in excess of national minimum wage.
“This issue with HMRC arose due to deductions for training costs from those with whom we parted company within 12 months of their employment.
“Deductions were therefore made from leavers for the cost of some of the training they had received.
“The third party payroll provider had advised that this was both legal and appropriate.
“All new staff were made aware of and agreed to these deductions.
“However, HMRC ruled that these charges were not allowed.
“As soon as they advised us of this, the required reimbursements were made to those affected.”
Bluebird Care had failed to pay £131.42 to one worker, with company owner Thomas Chack saying that the money was originally deducted from an employee’s pay after they left the firm suddenly despite receiving training from the company.
‘No excuse for not paying staff the wages they are entitled to’
Business Minister Margot James said: “There is no excuse for not paying staff the wages they’re entitled to and the Government will come down hard on businesses that break the rules.
“That’s why today we are naming hundreds of employers who have been short changing their workers; and to ensure there are consequences for their wallets as well as their reputation, we’ve levied millions in back pay and fines.”
Bryan Sanderson, chairman of the Low Pay Commission, said: “The Low Pay Commission’s conversations with employers suggest that the risk of being named is encouraging businesses to focus on compliance.
“Further, it is good to see that HMRC continues to target large employers who have underpaid a large number of workers, as well as cases involving only a few workers, where workers are at risk of the most serious exploitation.
“It is imperative that the Government keeps up the pressure on all employers who commit breaches of minimum wage law.”
If workers are concerned they are not being paid the correct rates then they can seek advice from workplace experts Acas.
Since 2013, the scheme has identified £8million in back pay for 58,000 workers, with 1,500 employers fined a total of £5million.
This year the Government says it will spend a record £25.3million on minimum wage enforcement.
The GMB union has argued that the Government should prosecute firms.
General secretary Tim Roache said: “These companies rake in millions of pounds in profit yet seemingly think it’s OK to cheat workers who are already paid a pittance out of the wages they are legally entitled to.
“It absolutely stinks.
“It’s impossible to feed and clothe your family and put a roof over their head on the minimum wage, without fat cat bosses trying to scam you out the pay you’ve worked hard for.
“Don’t get me wrong – of course it’s a good thing these companies are being forced to pay workers, and that they’re publicly being named and shamed - but it’s clearly not a deterrent.
“If companies think they can make some extra cash with no real sanction, we’ve seen today that it’s exactly what they’ll do.
“The Government should get serious and prosecute employers who rob working people of what they’re owed, otherwise this will happen time and time again.”