Firms rapped for not paying proper wages

Two Blackpool employers have been rapped for not paying the minimum wage.
Two Blackpool employers have been rapped for not paying the minimum wage.
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Two Blackpool employers have been ‘named and shamed’ for not paying staff the minimum wage.

The Mardi Gras Hotel, on Lord Street, and Papa Johns pizza takeaway, on Whitegate Drive, are on a Government list of 70 companies which have been fined and ordered to pay back arrears.

The Mardi Gras had failed to pay £3,206.76 to three workers, while Papa Johns had failed to pay £3,949.62 to 14 workers. As punishment they must pay back the arrears, plus a fine equivalent to 50 per cent of the back pay.

Lee Holman, who runs the Mardi Gras with his partner Steve Blanchard, said they fell foul of the rules when they charged staff £100 a week for ‘living in’ at the hotel, when HM Revenues and Customs only allows up to £34.80 to be taken from the wage for this benefit.

Mr Holman said: “The issue was these were live-in staff who lived in one-bedroom flats with living room, kitchen, and bathroom, also included was utility bills, council tax, phone bills and in one case mobile phone cost.

“This is where our problem was. However, ignorance does not make it OK and we accept this is correct.

“This issue was a genuine error on our part, but we have since worked closely with HMRC and we have paid the back-pay to the staff and our fine.”

Gavin Lilley, Operations Director for Papa John’s, said: “I can confirm there was an administrative error in the payroll at Fylde Coast Pizza Ltd which trades as Papa John’s in Blackpool.

“This error resulted in a total underpayment of £3,949.62 to 14 employees.

“This underpayment is not a result of failing to pay national minimum wage, and the technical error has now been rectified.

“At Papa John’s we value our loyal employees and apologise to all those affected.”

Business Minister Jo Swinson said: “Paying less than the minimum wage is illegal, immoral and completely unacceptable. Naming and shaming gives a clear warning to employers who ignore the rules, that they will face reputational consequences as well as financial penalties of up to £20,000 if they don’t pay the minimum wage.”

Blackpool South MP Gordon Marsden called for tough action against businesses which paid less than the minimum wage.

He added: “Up to now the Government has been very slow in dealing with such businesses that are doing this. Their record on taking action against those breaking the law has been very poor with not one single business being prosecuted at during the whole of 2014.”

The current minimum wage rates are: £6.50 an hour for adults, £5.13 for 18 to 20-year-olds, £3.79 for 16 to 18-year-olds and £2.73 for apprentices.