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Hospitality Industry and Leisure: Minimum Wage

Question for Department for Business, Energy and Industrial Strategy

UIN HL376, tabled on 18 May 2021

To ask Her Majesty's Government what assessment they have made of companies’ compliance with minimum wage requirements in the (1) hospitality, and (2) leisure, industries; and what steps they are taking to ensure such compliance.

Answered on

2 June 2021

The ONS’ Annual Survey of Hours and Earnings (ASHE) is the most detailed and comprehensive source of earnings information available in the UK. ASHE provides a proxy measure of both the scale and nature of non-compliance with the relevant statutory minimum wage. In April 2020, we estimate that there were around 38,000 jobs paid below the applicable minimum wage rate and non-compliant with minimum wage legislation in the hospitality sector, and 3,000 in the leisure sector. This excludes individuals who were furloughed, as they would not have been working at that time.

The Government is committed to cracking down on employers who fail to pay the NMW. We are clear that everyone entitled to be paid the minimum wage should receive it. As well as investigating every worker complaint, HMRC also undertake proactive investigations (referred to as targeted enforcement) based on the identification of the risk of non-compliance, and deliver a programme of upstream ‘Promote’ work designed to promote understanding and encourage employer compliance.

We have more than doubled the budget for minimum wage enforcement and compliance, which is now over £27 million annually, up from £13.2 million in 2015/16. There are now over 400 HMRC staff involved in the enforcement of the minimum wage. In 2020/21 HMRC concluded over 2,700 minimum wage investigations, returning more than £16.7m in arrears to over 155,000 workers. Since 2015, the Government has ordered employers to repay £100 million to 1 million workers.