In a single day in July, the TUC found 46 full-time jobs online that appeared to pay less than the national living wage.
In response, the national trade union body is calling for the government to crack down on minimum wage breaches.
“Recruiters and HR professionals should be more proactive in ensuring compliance with minimum wage laws,” said Su Apps, employment partner at Ashfords LLP, speaking to HR magazine. “Non-compliance can lead to significant legal and reputational consequences.”
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The national living wage has been set at £11.44 per hour since 1 April 2024. It means that a full-time worker should be paid a minimum annual salary of £20,820.20 for 35 hours per week.
A TUC representative reminded employers that, while workers aged under 21 can be paid lower rates, advertising roles at lower rates potentially excludes older workers and could be unlawful due to indirect discrimination.
At the same time, the national minimum wage legislation is not straightforward and can be difficult to follow, another employer explained.
Paul Stokey, partner and head of employment at Shoosmiths law firm, told HR magazine: “Currently four different rates of national minimum wage apply, depending on a worker’s age. Keeping on top of the changing rates, both as workers move between the age bands and in relation to the annual increases, can be tricky.
“On top of this, calculating what counts towards pay and the hourly rate of pay, taking into account different working patterns, is complex. Employers frequently fall foul of the rules around deductions for uniforms or salary sacrifice arrangements.”
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Sectors that frequently rely on variable pay structures, such as hospitality, retail and gig economy work, are particularly vulnerable, explained Apps.
“Vigilance is particularly crucial in these sectors,” Apps continued. “Deductions or unpaid training time can easily result in wages falling below minimum thresholds.
“Misclassifying workers as independent contractors is another common risk, particularly in light of recent cases challenging worker status.
“Regular audits, thorough record-keeping and clear communication about pay policies can mitigate risks.”
Stokey added: “It is critical that recruiters, recruiting managers and HR advisers are aware of the national minimum wage rules, and apply them correctly. Advertising roles at below national minimum wage risks at best putting workers off applying. At worst, getting the national minimum wage wrong could lead to an employment tribunal claim for unlawful deduction of wages, or potentially a civil court claim for breach of contract.
“As well as the associated legal fees, claims could result in awards of repayment of up to two years’ worth of deductions and compensation for the successful claimant.”
