Hair and beauty sector targeted in new national minimum wage campaign

Employers in the hairdressing and beauty sectors who pay their staff below the national minimum wage (NMW) are being targeted in a new campaign announced today.

As part of this campaign – the first of its kind – HM Revenue and Customs (HMRC) and the Department for Business, Innovation and Skills (BIS), supported by the National Hairdressers’ Federation and the Hair and Beauty Industry Authority, will work with hair and beauty businesses to help them understand their pay obligations to their employees.

HMRC will provide employers with tailored tools and guidance to check if they are paying the correct amount, and put it right where they are not. Employers who take this opportunity to self-correct will not have to pay penalties, nor will they be ‘named and shamed’. If employers choose not to comply with their NMW obligations, HMRC will take action to ensure that employees are paid what they are owed.

HMRC action to tackle employers who fail to pay the minimum wage identified £3.2 million in NMW arrears involving over 26,000 workers across a range of sectors in 2014/15 alone. The Government is committed to ensuring every employee receives at least the NMW, and HMRC is helping workers to recover any money owed to them.

BIS analysis shows that 42% of businesses in the sector do not pay level 2 and level 3 apprentices the correct minimum wage – the highest underpayment rate of any sector. Those paying under the minimum wage now have a chance to put things right. If they fail to do so it could result in their business being publicly ‘named and shamed’ and facing a fine of up to £20,000 per employee.

Jennie Granger, HMRC Director General of Enforcement and Compliance, said:

“This innovative campaign is about helping employees who have been underpaid get the money they are legally due back into their pockets. It will help them understand where they can report underpaying employers confidentially.

“It is also about helping employers check if they are making mistakes, and self-correct if they are. Some employers will need a bit of a reminder to check they are getting it right, and some will need stronger action from us, so we are bringing in more enforcement officers to support this campaign.

“I urge all employers and employees in the sector to check that salary is being paid correctly, as we will use these extra resources to find and investigate where it is not. Check you’re paying NMW correctly – it’s worth it." 

This new campaign is the first step in expanding HMRC’s compliance activities using smart data.

The government, in the Summer Budget, announced extra funding to expand HMRC’s data analytics and enforcement teams.

Employers who are unsure of NMW rules and want to find out more can get free advice through the Acas helpline 0300 123 1100.

Hair and beauty businesses are being asked to come forward as part of the National Minimum Wage Campaign by:

• Telling HMRC they want to take part in the campaign
• Disclosing details of arrears now paid to their workers and confirming that wages worth at least the NMW are now paid to all workers

For more details, plus help and support on the campaign, employers can phone a dedicated helpline on 0300 123 2671 or visit HMRC’s website at: https://www.gov.uk/nmwcampaign

Notes for editors:

1. Employees can report under-payment of the NMW at: https://www.gov.uk/pay-and-work-rights.

2. More information about the national minimum wage: https://www.gov.uk/national-minimum-wage/employers-and-the-minimum-wage.

3. There are 55,000 businesses in the hair and beauty sector in the UK.

4. There are 250,000 people are employed in the sector in the UK.

5. The typical hourly rate of pay in the hair and beauty sector is £7.11 compared with £11.61 in other sectors.

6. Follow HMRC Press Office on Twitter @HMRCpressoffice.

7. HMRC's Flickr channel: http://www.flickr.com/hmrc.gov.uk.