HMRC targets care sector to ensure all staff are paid National Living Wage

Living Wage

Care sector employers will face tough legislative and reputational sanctions if they don’t pay the National Living Wage, warns the National Audit Office (NAO) in a new report highlighted by Bond Payroll marketing manager Gary Webb ahead of the company’s participation at the Health+Care show.

The exhibition and conference runs 29–30 June at Excel London.

The HMRC has increased the compliance and enforcement budget to £20 million for 2016-17 compared to £13.2 million in 2015-16, Mr Webb warns, and has specifically singled out the care industry.

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The causes of non compliance were reported as

  • Unpaid training time
  • Hourly pay rate below National minimum wage rate
  • A lack of awareness of the accommodation offset rules and their effect on NMW pay calculators
  • Incorrect use of apprentice rates
  • Unpaid travelling time between appointments
  • Localised and franchised contractual arrangements
  • Failure to pay workers for all working time

The Low Pay Commission found that 11 per cent of care workers were not being paid the National Living Wage, with estimates of between 160,000 and 220,000 employees affected, and £130 million in lost wages.

Care sector employers need to be aware of their responsibilities and have a tight payroll system in place to ensure the law is followed. If they don’t the consequences could be both financial and reputational, as HMRC’s policy is to name and shame care providers as well as hit them with penalties. To date 15 care providers have been named as part of this process.

HMRC is currently investigating 141 employers, and with the additional funding this year for investigation care homes will need to move quickly to ensure they are compliant.

Tags : Bond PayrollHMRCNational Living Wage

The author Rob Corder

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