National Minimum Wage Enforcement

“This Assembly believes that improving enforcement of the National Minimum Wage should be made a key priority for the Government, with the failure to properly enforce the National Minimum Wage allowing many rogue businesses to undercut wages and drive down pay for people on low-incomes. While regional data on enforcing the National Minimum Wage is not available, the Centre for London and the Trust for London estimates that more than 300,000 people in the UK earn less than the legal minimum wage. Despite this, only nine employers have ever been prosecuted for breaching this law, while only one employer has ever been ‘named and shamed’. These figures demonstrate that the current enforcement regime is not sufficient.

This Assembly believes the Mayor should champion means by which enforcement can be improved in London. To this end, the Assembly calls on the Mayor to lobby the Government to take forward many of the recommendations put forward by the Trust for London and Centre for London report, ‘Settling for Nothing Less: Enhancing National Minimum Wage Compliance and Enforcement’ in London. In particular, we support proposals for:

• Devolving enforcement responsibilities to local authorities and allowing them to retain funds that are generated through fines, as part of a wider need to increase the number of proactive investigations into National Minimum Wage violations.
• Removing the upper-limit on fines for violating the National Minimum Wage; and
• A more rigorous approach that ensures that every company that breaches the National Minimum Wage is ‘named and shamed’.

Furthermore, we call on the Mayor to undertake an audit of the Greater London Authority’s supply chain to ensure it holds no contracts with companies paying less than the National Minimum Wage. We believe the Mayor should use his business engagement team to urge all private sector businesses in London to also undertake such audits.”