Retail Giants WH Smith, M&S, and Argos Found Guilty of Minimum Wage Violations

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WH Smith, Marks & Spencer and Argos are among a string of companies named for failing to pay the minimum wage.

More than 200 firms face penalties of nearly £7m and must reimburse workers for breaches dating back over a decade.

WH Smith, Marks & Spencer and Argos all said the breaches were unintentional and had been swiftly remedied.

It is unclear how much they paid in fines, but the government said penalties amounted to up to 200% of the arrears owed.

“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 Kevin Hollinrake, minister for enterprise, markets and small business.

This April, the National Living Wage and Minimum Wage experienced a notable increase of 9.7%.

According to the business department, some 63,000 workers were left “out of pocket” because of the breaches, most of which occurred from 2017-2019.

WH Smith emerged as the most significant violator, having neglected to pay over £1 million to more than 17,600 workers.

The retailer attributed its non-compliance to a misinterpretation of regulations regarding uniforms, as it required employees to wear specific coloured trousers, skirts, and shoes without providing adequate reimbursement.

“Following a review with HMRC in 2019, and in common with a number of retailers, it was brought to our attention that we had misinterpreted how the statutory wage regulations were applied to our uniform policy for staff working in our stores,” a spokesman said.

“This was a genuine error and it was rectified immediately with all colleagues reimbursed in 2019.”

Following WH Smith, Lloyds Pharmacy stood out as the next prominent offender, with a failure to pay over £903,000 to a total of 7,916 workers.

According to Acas, the conciliation service, it is unlawful for an employer to pay less than the National Minimum Wage or National Living Wage. Additionally, employers are required to maintain accurate pay records and make them available upon request.

If an employer has failed to pay the correct minimum wage, it is crucial for them to address and rectify the issue promptly, even if the employee or worker is no longer in their employ.

Resolving the situation can often be achieved through informal discussions between the employer and employee or worker.

In more formal cases, the employee or worker has the option to lodge a complaint directly with the employer, report the matter to HM Revenue and Customs (HMRC), or file a claim with an employment tribunal.

M&S said it had only been named by the government because of an “unintentional technical issue from over four years ago”.

The government has confirmed that it did not fulfil payments totalling £578,390.79 to a group of 5,363 workers.

But an M&S spokeswoman said: “This happened simply because temporary colleagues were not paid within the strict time periods specified in the National Minimum Wage regulations and was remedied as soon as we became aware of the issue.

“Our minimum hourly pay has never been below the national minimum wage, it is currently above it and no colleagues were ever underpaid because of this.”

Sainsbury’s, the parent company of Argos, has been instructed to reimburse £480,093.58 to a total of 10,399 workers. The company explained that this issue stemmed from a payroll error discovered in 2018, which had impacted certain Argos store workers and drivers. It should be noted that these errors occurred prior to Sainsbury’s acquisition of Argos and dated back to 2012.

The retailer said it had launched an immediate investigation and “put this right at the time”.

“Since then we have completed the integration of Argos onto Sainsbury’s systems which will prevent this from happening again.”

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