A construction company owned by Kier Group has been “named and shamed” for failing to pay the legal minimum wage to its lowest-paid workers.
Hertfordshire engineering services provider, McNicholas Construction, is one of 202 businesses that failed to pay the National Minimum Wage to staff, following an investigation by His Majesty’s Revenue and Customs (HMRC) between 2017 and 2019.
It found McNicholas failed to pay £170,517 to 704 workers.
McNicholas and others were ordered to repay staff for breaches of National Minimum Wage (NMW) law, which they did, or face a nearly £7 million penalty.
However, it is understood fines were also issued to all business.
The investigation showed the employers collectively failed to pay nearly £5 million to their staff, leaving 63,000 workers out of pocket.
It found employers underpaid workers in the following ways:
- 39% deducted pay from workers’ wages
- 39% failed to pay workers correctly for their time
- 21% paid the incorrect apprenticeship rate
“Whilst not all minimum wage underpayments are intentional, there is no excuse for underpaying workers,” wrote the Department for Business and Trade (DBT).
Companies in the report range from major high street brands like WHSmith, Marks & Spencer, and Argos, to small businesses – like a plastering company in Colchester – and sole traders.
Toolstation, in Bridgwater, failed to pay £3,090.18 to 79 workers.
As of April, the National Minimum Wage is £10.18ph for those aged between 21 and 22, £7.49ph for those aged between 18 and 20, and £5.28ph for apprentices and under-18s.
Workers aged 23 and up who are not in the first year of an apprenticeship are entitled to a minimum of £10.42ph, the National Living Wage.
Kier acquired Elstree-based McNicholas in 2017 to bolster its utilities and infrastructure offering.
“Paying the legal minimum wage is non-negotiable and all businesses, whatever their size, should know better than to short-change hard-working staff,” said minister for enterprise, markets and small business, Kevin Hollinrake.
“Most businesses do the right thing and look after their employees, but we’re sending a clear message to the minority who ignore the law: pay your staff properly or you’ll face the consequences.”
A Kier spokesperson said: “These practices were carried out by McNicholas Construction before we acquired the company in 2017, however as a responsible business we took action at the time to redress this matter.
“As an accredited Real Living Wage (RLW) employer, we remain committed to providing competitive salaries and excellent benefits for our people.”
Guidance for employers on pay is available here.
Guidance for workers on pay is available here.
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