Is it right to name and shame minimum wage 'dodgers'?

The government's policy of listing firms that haven't paid the minimum wage is a blunt instrument, but perhaps that's what's needed.

by Adam Gale
Last Updated: 11 Aug 2016

Shame is a powerful tool for getting compliance. The scorn and disgust poured on law-breakers can be a better deterrent to would-be ne’er do wells than the sentences handed down by courts.

It’s why the government doesn’t stop at fining companies that have failed to pay the minimum wage to their employees. Instead, after all the fines and wage arrears have been paid, the authorities release lists of the offending firms for easy media consumption.

Not every business named – there were 198 in the latest release – will find themselves in the local paper, but for those that do it’s the modern equivalent of being hauled into the stocks and pelted with cabbage. Not fun.  But do they deserve it?

A big no-no, but did they know?

The problem with naming and shaming over a legal violation like this is that it strips out the context. Small businesses – and these are almost always small businesses – are less likely to know the ins and outs of employment law than their corporate peers.

Their reasons for failing to pay the minimum wage could vary from honest mistakes to wilful deception.

Last year Monsoon Accessorize was revealed to be over £100,000 in arrears, but said it was because its benefits-in-kind had been deducted from the base rate. A Nottinghamshire firm meanwhile blamed a ‘time-logging error’. The list goes on.

It’s hard to know whether these are mere excuses or shades of grey, but it’s fairly safe to say that some on the list deserve the shame more than others.

Ignorance of the law is clearly no excuse, but on the other hand it seems a touch unfair to tar offenders who didn’t set out to swindle low-paid workers of their entitlements with the same brush as those who did.

Unfortunately for those suffering reputational damage disproportionate to their mistake, this does not mean the policy should be revised.

Whether or not you agree with the level or indeed existence of the minimum wage, it is the law – and seemingly one that is violated fairly regularly. It has to be upheld, and if naming and shaming is effective, so be it.

So while some small businesses may find it galling that their corporate cousins are able to massage their tax bills without similar punishment, the bottom line is that paying the minimum wage (including the new national living wage for over 25s) is something that no one can ignore without consequences. 


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