PMP Recruitment are committed to being the most ethically and legally compliant employment business in the UK. We recognise the importance of monitoring process management and ensuring compliance procedures are followed at all times.
We operate in line with the Conduct of Employment Agencies and Employment Businesses Regulations 2003 (the Conduct Regulations) which are in place to regulate processes and operations within the recruitment industry.
Our expert compliance team is well versed in the government legislation surrounding NMW, NLW and worker protection as a whole, and make it their priority to ensure our business and it’s stakeholders are kept up to date with any changes.
At PMP Recruitment we can provide both job seekers and our clients with the peace of mind that by partnering with us they will receive the most ethically and legally compliant employment service in the UK.
2016 brought many challenges to the recruitment sector; one in particular was National Minimum Wage (‘NMW’) or the National Living Wage (‘NLW’). The legislation around NMW meant that some companies inadvertently paid their workers below the NMW/NLW in 2016 due to not fully appreciating the complexity of the law. This unfortunately brought negative publicity to certain companies and brands thus affecting their revenue, reputation and customer trust. In many cases the companies thought that they were compliant and have now had to review and amend their policies and procedures.
At PMP we believe that in 2017 there will be further scrutiny on this legislation and we anticipate that this will be directed in particular to the temporary workforce sector.
Following recent high profile cases in the media, HM Revenue and Customs’ (‘HMRC’) National Minimum Wage (‘NMW’) enforcement teams appear to be focussing their attention on sectors which rely heavily on flexible employment models.
The penalties for non-compliance with the NMW/NLW are significant. Businesses will not only have to make up any arrears in pay (potentially going back upto six years), but also face additional fines of 200% of the underpayment identified (up to a maximum of £20,000 per worker) and being publicly announced by the Department for Business, Energy & Industrial Strategy (formerly BIS).
Recent cases have shown that even though workers may be paid a rate of pay that is compliant with the National Minimum Wage (‘NMW’)/National Living Wage (‘NLW’), employers may unknowingly fall foul of the rules by not taking into account certain deductions from pay.
It is prudent that all companies critically review their business model with particular emphasis on the impact of any deductions made from workers pay and how they are recording and counting hours worked. This would include the following:
Any deduction from pay, other than those expressly allowable under the NMW regulations, which either:
relate to a worker's expenditure in connection with their employment i.e. a worker incurs a business-related expense which is not reimbursed by the employer; or
is made for the employer's own use and benefit i.e. where the deduction is made by the employer and the employer is free to use that money in any way they wish, regardless as to whether the employer profits from the arrangement or the employee freely enters and benefits from the arrangement.
Any payments made by a worker to their employer, or to a third party, on account of a worker’s expenditure in connection with his/her employment (whether or not it is reimbursed), or if the payment is retained for the employer's own use and benefit
In respect of hours that are likely to be deemed as time for which a worker should receive the NMW / NLW, the following should be reviewed and carefully considered:
Ensuring workers receive payment for time spent undertaking training that the employer requires them to undertake e.g. induction training. Some employers provide training as part of a pre-employment assessment process for which a worker is not paid. While this is allowable, care must be taken to ensure that attendance of such events is not a pre-agreed condition of employment, that the training covered is not something the employer requires the employee to undertake under their contract, and that there is a robust assessment at the end of the process to select which attendees are to be offered employment
Rounding up of time deducted from a timesheet or within a time and attendance system where an employee clocks in a few minutes late e.g. worker clocks in two minutes late and their working time is deducted by 15 minutes
Where workers are required to be onsite and available for work, or for a handover prior to them starting their shift
Ensuring workers receive pay for any time they are inactive as a result of an equipment breakdown / failure
Late notice cancellations of shifts i.e. where the worker has arrived at site and is waiting to commence work
The above list is not exhaustive, and other elements of a worker’s time on site could also be deemed to be working time for which they must receive the NMW / NLW.
For example, we know from recent high profile cases that HMRC NMW have deemed time workers have spent queuing to pass through security checks after clocking off to be time for which a worker should be paid the NMW / NLW. This analogy can be applied to other situations e.g. where workers are required to change into or from PPE before their shift starts or after their shift ends, could also be deemed working time for NMW/NLW purposes.
It is Cordant Group’s responsibility to make sure that working times are recorded correctly and that no employee falls below the NMW.