Claiming Minimum Wage

[SERC1204]

Good evening

I’ve been helping a friend with their personal tax return (keen, I know!) and in the tax year 2017-18 they have had employed and self-employed income. For one particular period of employment I noticed that the final pay slip/P45 didn’t quite tally given what their monthly earnings should be. When I queried them on this, they said that the employer had put them on a commission only pay structure (they had “agreed” to this) and that they didn’t earn any commission. The only pay they received for their final month of employment was the holiday pay they had accrued - basically they worked for circa two weeks without pay.

As an accountant with a fair amount of payroll and related experience, I’m comfortable with the requirements of minimum wage and in principle what an employee can do to claim minimum wage. However, the period of employment ended last October, so is outside the 3 month claim period. Is there any recourse other than small claims, is this even a possibility this long a after? The amount in question is nearly £700 and some might let this go, but I believe the employer is a bit of a shark and quite frankly an ar*e!

Thanks muchly...

 

[Newchodge]

You can report the employer to the HMRC minimum wage enforcement unit, and they may eventually do something about it. I reported Asda more than 12 months ago and the last I heard they had pointed out to the employer the situations in which they were failing to pay minimum wage, but it still hasn't been resolved, and they aren't on the latest list of those failing to pay, so don't hold your breath!

You can't take an employment tribunal, as too much time has elapsed, but a small claim action may be feasible. It would be on the grounds of breach of contract, as there is an implied term in an employment contract that the employer will meet statutory requirements.

 

[SERC1204]

Hi Candy, thank you for the reply and information.

They did agree to the commission only remuneration, would this have any bearing on breach of contract? In hindsight they know is seems a silly thing to have agreed to, but nothing’s clearer than hindsight! Maybe the thought of being reported to HMRC. Ignore give some leverage.

Thank you again

 

[Newchodge]

That is OK. You cannot legally agree to sign away a statutory right, without jumping through all sorts of legal hoops and no-one, whatever they do, can sign away their right to minimum wage.

 

[SERC1204]

Thanks again Cindy.

 

[UKSBD]

3rd time lucky? ;-)

 

[SERC1204]

Apologies, Cyndy, I must watch out for autocorrect

 

[Newchodge]

Apologies, Cyndy, I must watch out for autocorrect

Please don't worry you're not the first and you certainly won't be the mast,

 

[NRLtd]

Hi Cyndy

One more thing, if I may...? (sorry, shoe horning my way into this thread - similar to a situation I am in with an ex employer)

Are they entitled to claim interest and fees, should they have to proceed via small claims?

Thank you again Cyndy...

 

[Newchodge]

Court fees for bringing the claim are added to the total award against the Defendant. You should state that you wish to add statutory interest on the claim form.

 

[NRLtd]

Court fees for bringing the claim are added to the total award against the Defendant. You should state that you wish to add statutory interest on the claim form.

Thank you, earlier days at present, but worth knowing just in case

 

[SERC1204]

Hi

Well the employer is being less than amiable and refusing to pay (as expected!), they claim out of time, agreed to commission only etc., so it looks like small claims is the main recourse.

I’ve used the money claims service myself before, but never for an employment related situation like this one. I’m assuming it’s best to be honest in that the employee was offered commission or nothing, they agreed to this (albeit with eyes half open) as it was that or leave and claim for a breach of implied terms...?

Thanks muchly...

 

[Newchodge]

Hi

Well the employer is being less than amiable and refusing to pay (as expected!), they claim out of time, agreed to commission only etc., so it looks like small claims is the main recourse.

I’ve used the money claims service myself before, but never for an employment related situation like this one. I’m assuming it’s best to be honest in that the employee was offered commission or nothing, they agreed to this (albeit with eyes half open) as it was that or leave and claim for a breach of implied terms...?

Thanks muchly...

Just state that the rate paid did not amount to NMW

 

[SERC1204]

Thank you Cyndy

 

[SERC1204]

Further to my subsequent posts above, the employer has now responded with a few more details, basically their view/recollection of events.

The general basis of this is that the employee in question "offered" their services on a voluntary basis (employers words, refuted by the employee) for commission only and that during the weeks in question they didn't actually work their "contracted" hours (employers wording and again refuted). I've seen and reviewed the emails between ex-employee and employer (current and going back to the original time, there is mention of a contract end date (being the date the employee actually left), that they were in attendance during the weeks in question (although no specifics dates/times) and even a required notice period worked/to be worked. There is no mention of the employee making an offer, only that they "agreed", the employee insists the offer was made to them. The employer has also pointed out that the employee has had nearly a year to bring this up but hasn't. I'm still confident in the employee's stance and from my view point I can see there was an employment relationship, but it's now looking like one party's word against the others.

I'm thinking that an HRMC report is a first point of action as their decision could back up any small claims (they are concerned if the employer wants to claim legal fees and the small claims is lost)? To some the amount may not seem a lot, but to the employee it's the equivalent of a months rent, utilities and groceries.

Thank you.

 

[Newchodge]

As it is a single employer you may get HMRC to take action within 6 months. It's worth a try.

The employer's arguments are worthless, except if they can prove that the hours weren't worked.

 

[SERC1204]

Thank you very much again Cindy.

From my "lofty" position I can see that whatever work they did (voluntary, offered, pressganged!) it appears to be an extension/continuation of the original employment contract and the original wording used by the employer implies this (even if their has been a recent change of tune).

Could the time lag potential go "against" them/the employee?

Thank you again.

 

[Newchodge]

Thank you very much again Cindy.

From my "lofty" position I can see that whatever work they did (voluntary, offered, pressganged!) it appears to be an extension/continuation of the original employment contract and the original wording used by the employer implies this (even if their has been a recent change of tune).

Could the time lag potential go "against" them/the employee?

Thank you again.

The time lag is only a problem in that they can't go to the employment tribunal. They have 6 years to go to court.

 

[SERC1204]

Thank you again Cyndy

And apologies again for name mis-spelling!

 

[SERC1204]

Good afternoon


There has been some progress on this, HMRC took up the case with the employer just before Christmas, they would/should have started about four weeks earlier but asked (in error) for an additional fours weeks for the employer to pay...

HMRC queried the ex-employee on why they had taken so long to raise the issue, but the Compliance Officer didn’t seem too concerned with this. They have been in touch with the employer, who are claiming that the employee had sick leave and that there were other periods of leave/absence, the employer is also claiming there are emails referencing these periods. All of this is categorically refuted by the ex-employee but the NMW Compliance Officer has asked for anything in support of proving the ex-employee actually worked. HMRC don't seem to be insisting on this, but I see that it would support the the ex-employee’s stance. In general, they have payslips/HMRC pay record, a job offer email and a termination email (the later does reference genuine holiday/leave taken and refers to a "last day in the office").

Given the above, it seems very much a case of the word of one party against the other.

 

[Newchodge]

Given the above, it seems very much a case of the word of one party against the other.

It always is, but there is usually some physical, written, email evience to support one side or the other. The lack of such evidence is also evidence against one side or the other on the basis that if x happened there would be some physical evidence.

 

[SERC1204]

Thank you Cyndy

At present it is mostly email evidence which builds a picture and infers/implies a situation. The employer has changed/added things they haven’t before. The ex-employee has been relatively consistent.

Thanks again.

 

[kulture]

I suspect that HMRC are used to employers raising all sorts of "reasons" and excuses why they did not pay.

 

[SERC1204]

Hi, just a quick update...

HMRC have now informed the ex-employer that they owe the employee and that if paid soon there won't be a penalty or full NMW investigation. HMRC cannot enforce payment of holiday taken during the time in question, so the ex-employee will have to consider their small claims options if they wish to pursue the remaining amount.

Thank you for everyone's advice and input.