Care providers who fail to pay the minimum wage could be damaging their business, research shows

Government issues stark warning to businesses as it cracks down on non-compliance with minimum wage laws

Care providers who pay less than the minimum wage could suffer from bad reputations, low staff productivity and high employee turnover, the Department for Business, Innovation and Skills (BIS) has warned.

Eight out of 10 people surveyed on behalf of BIS said they “would not work as hard” if they knew they were being underpaid. The vast majority (85%) said they would look for a job elsewhere.

The research also suggested that four out of five people would avoid doing business with a care provider if they knew the company did not pay at least the minimum wage.

The government is stepping up efforts to name and shame employers who do not comply with minimum wage laws, recognising that social care has been identified by the Low Pay Commission as a particularly high-risk sector.

It is estimated that between 160,000 and 220,000 care workers receive less than the minimum wage.

“Today’s research shows the impact on staff productivity and a business’ reputation of underpaying workers. Businesses can’t ignore this issue and stick their head in the sand,” said employment relations minister Jo Swinson.

“Employers who fail to pay workers the right amount will face a financial penalty, be publicly named and shamed and may even be prosecuted.”

Ken Deary, owner of care provider Right At Home, said: “If you run a business, there is a lot to get your head around. Payroll in particular can be confusing. Despite that, ensuring that your employees are being paid correctly should be at the top of your priority list.

“Everyone deserves the National Minimum Wage as a minimum and if you aren’t paying it you are breaking the law. BIS enforces this law and if caught, you will face fines and public naming, which can hit your bottom line hard and even sink a small business.

“On the flip side, employers who pay correctly enjoy better local and industry reputation and more motivated, hardworking staff.”

The online survey of 2,000 British adults was carried out by polling company Populus between 2 and 3 October.

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One Response to Care providers who fail to pay the minimum wage could be damaging their business, research shows

  1. Alan November 1, 2013 at 1:40 pm #

    Lets not forget about the domiciliary side where the care worker may be working less than 20 hours a week but have to be available from early morning to late at night then no holidays pay, no sick pay, no redundancy, no travel expenses, no paid travelling time may be the norm for they are employed on what is termed bank but would be more acurate to call it casual labour. The companies seem to ignore that as a consequence of this is a high staff turn over is the norm, how they can justify training new staff at the rate they need to must be very costly possibly why in my area in the last five years three companies no longer exist. I accessed info under the freedom of info act and found one firm was paid travel time and mileage but failed to pass it on so that some care workers were covering fuel costs of over £70 a week.
    The following is a passage in his book by a businessman around 1925/30
    You must never expect your staff to love you: why should they. Any attempt to secure their devotion would be the most disastrous folly. No, it is you who must love them. You must care for them in every way, and genuinely, not hypocritically and for your own advantage. You must take them into your confidence, you must explain what you are trying to do and what the difficulties are, you must convince them, by your actions that their welfare is your primary concern. Words won’t be enough.