Employment agencies in Corby may have underpaid 3,000 workers in the area by £100,000 – an investigation by HM Revenue and Customs has uncovered.
A number of agencies were investigated during a three-day blitz by a multi-agency taskforce aimed at tackling migrant labour abuse.
HMRC and officers from the Department for Business Innovations and Skills (BIS) visited 34 employment agencies between Tuesday and Thursday this week, May 28 and 30.
Michelle Wyer, assistant director of National Minimum Wage for HMRC, said: “This cross-government taskforce operation has allowed us to get into the heart of the community to tackle those employers who operate outside of the law and deliberately fail to pay the National Minimum Wage.
“We will not hesitate to use our full enforcement powers to ensure that workers receive the money to which they are legally entitled.
“Anyone with questions or concerns about the National Minimum Wage should call the Pay and Work Rights Helpline on 0800 917 2368.”
In April this year, Corby MP Andy Sawford hosted a summit in the town aimed at tackling problems associated with some employment agencies.
He called for a code of conduct to be set up for agencies to follow.
Mr Sawford said: “I have mixed feelings about the findings from this operation.
“On the one hand I am pleased that this has been exposed, but on the other hand I think it is disappointing that there are so many breaches of the National Minimum Wage rules.”
Mr Sawford said he had spoken to the HMRC officers taking part in the investigation, and among the practices they had uncovered were workers being docked pay for transport costs and provision of safety equipment.
HMRC says it can issue penalties of up to £5,000 to businesses found to be paying their workers less than the National Minimum Wage.
They will also be required to pay any wage arrears at today’s National Minimum Wage rates.
The crackdown on employment offenders comes as part of the government’s drive to introduce tougher action against businesses which use illegal labour. The Immigration Bill, announced in the Queen’s speech, will put added pressure on those who have no right to live in the UK to leave the country. New measures include proposals to double the fines levied against those found employing workers who have no legal right to be here to a maximum of £20,000.
Employment Relations Minister Jo Swinson said: “I fully support the joint approach being taken by these enforcement bodies.
“The advice and guidance given by our investigators on these visits made sure that agencies are fully aware of their legal responsibilities and what they need to do to abide by the law.
“We want to make sure that the employment rights of vulnerable agency workers are protected and create a level playing field for that vast majority of agencies who play by the rules.”
HMRC officers will carry out further investigations into the activities of the businesses suspected of failing to meet their tax and national insurance obligations.