The LPC’s non-compliance and enforcement report looks at why so many apprentices are underpaid and what can be done about it
The Low Pay Commission (LPC) today publishes its third stand-alone report into compliance with and enforcement of the National Minimum Wage (NMW). The report uses data from 2019 to investigate the nature and extent of underpayment. This dates from prior to the current Covid-19 outbreak and shutdown, which have had significant impacts for many low-paid workers and their employers.
Bryan Sanderson, Chair of the LPC, said:
Read the LPC’s 2020 non-compliance and enforcement report
The report examines underpayment of all groups of low-paid workers, but focuses in particular on apprenticeships, where surveys show around one in five apprentices earn less than their legal entitlement. The LPC’s analysis suggests that confusion around the requirement to pay apprentices for their training hours is likely to account for a large proportion of this underpayment. The LPC makes several recommendations to Government to better protect apprentices, by reviewing how it investigates these cases and better communicating the risks they face.
The report also looks at the problems workers face in accessing their payslips and understanding whether or not they are underpaid. Recent changes to the rules have improved workers’ rights, but still need to be publicised and enforced.
Overall, the report finds that the amount of measured underpayment fell slightly in 2019 from 2018, with over 423,000 workers recorded as underpaid. But this level remains higher than in many previous years, and the prevalence of underpayment varies significantly by occupation. HM Revenue and Customs’ enforcement activity in 2018/19 secured the repayment of more arrears for more workers than ever before. The report considers what HMRC’s statistics do and do not tell us about their work, and what more needs to be done to ensure the enforcement regime is as effective as possible in meeting the needs of underpaid workers.
Recommendations
In full, the LPC’s recommendations to the Government in its 2020 non-compliance and enforcement report are: