GOVERNMENT
RESPONSE FOLLOWING CONSULTATION ON PROPOSALS TO AMEND THE NATIONAL MINIMUM WAGE
ACT 1998
Background
to the Consultation
The
National Minimum Wage Act 1998 (”the Act”) introduced a national
minimum wage in the United Kingdom for the first time. The national
minimum wage has now been in operation for four and half years.
Minor amendments to the enforcement of the national minimum wage will be
taken forward in
the Employment Relations Bill,
introduced on 2 December 2003.
The proposals in the consultation
(16Kb) note issued on 12 August 2003 arose after careful consultation
with the Inland Revenue, who have been responsible for enforcement of the
national minimum wage since 1999, and with the Department of the Environment,
Food and Rural Affairs (“Defra”), who enforce the agricultural minimum wage
in England and Wales.
The
consultation note proposed six amendments to the National Minimum Wage Act 1998.
These are summarised below:
Section
13: This gives the Secretary of State power to appoint officers from other
Departments or bodies are to enforce the minimum wage, and we have appointed
officers from the Inland Revenue to do so on behalf of the DTI.
We proposed that a similar power should be given to the Secretary of
State for the Environment, Food and Rural Affairs in respect of the agricultural
minimum wage.
Section
15: We were concerned that because of the restrictions regarding the
disclosure of information obtained by enforcement officers in this section,
officers may not be able to disclose information obtained from the employer to
the worker, or information obtained from the worker to the employer.
We proposed to amend to amend this section to make it clear that this
disclosure was allowed, to help enforcement officers determine whether employers
are complying with the legislation.
Sections
17 and 19: We proposed two minor amendments here. An amendment to section 17
designed to ensure that no one could run the argument that the 1998 Act does not
cover former workers. We also proposed a technical amendment to section 19 to
put completely beyond doubt the fact that a single enforcement notice may relate
to more than one worker irrespective of whether the employer’s failure to pay
the minimum wage is a previous or ongoing failure.
Section
19: Officers are presently unable to amend or withdraw enforcement notices,
even if they realise they have made an error or new evidence has come to light.
This is inefficient because tribunal hearings are the only way to rectify
incorrect notices.
We proposed therefore to allow officers to withdraw enforcement notices
where appropriate, and to amend notices either to correct errors or to add
additional pay periods to the notice.
Section
21:
We also proposed to allow officers to withdraw penalty notices where it
was clear that these should not have been issued, and to amend penalty notices
where errors have occurred.
Response
to the consultation
The DTI received few responses to the
consultation but they did include representations from the Engineering Employers
Federation, the Trades Union Council and the Knitwear, Union of Footwear and
Apparel Trades. Responses on the
whole were supportive. Two main
points arose relating to the amendment on disclosure of information.
These concerned the need to prevent an employer from identifying a worker
who has made an anonymous complaint; and a request that information relating to
complaint cases to be shared with worker’s representatives.
The first point (about anonymous complaints) is
presently under consideration. But
this does not affect the drafting of the amendment in the forthcoming Employment
Relations Bill. On the second
point, the Inland Revenue already operate a system under which workers can sign
an authorisation permitting an intermediary to be given access to all their
confidential details in connection with a minimum wage investigation. We will look at the possibility of publicising this further.
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