Source · Select Committees · Business and Trade Committee
Recommendation 20
20
Rejected
Paragraph: 127
Set out Government plans for statutory protection against unscrupulous umbrella company practices
Recommendation
The actions of unscrupulous umbrella companies are depriving workers of rights and in some cases remuneration, and they are damaging the reputation of umbrella companies as a whole. There is widespread agreement that the Government should act to provide statutory protection from such practices. In response to this Report, the Government should set out its plans for doing so, or should explain what obstacles are preventing it from doing so.
Government Response Summary
The government rejects the committee's characterisation of enforcement, stating it does not agree and detailing existing HMRC minimum wage investigations and increased investment in enforcement bodies, arguing that the UK already has a robust system for enforcing employment rights.
Paragraph Reference:
127
Government Response
Rejected
HM Government
Rejected
The Government does not agree with the Committee’s characterisation of enforcement. In 2021/22, for example, HMRC concluded over 2,800 minimum wage investigations and returned more than £16.3m in arrears to over 120,000 workers, further issuing 696 fines totalling £13.2m to business who had failed to pay the minimum wage. The Government continues to increase investment in state enforcement bodies, more than doubling the budget for National Minimum Wage compliance and enforcement to £27.8m for 2022/23, up from £13.2m in 2015/16. Elsewhere, the Government has taken steps, including recruitment of judges, to return Employment Tribunals to pre-Covid levels of hearings. MoJ and DBT are continuing to work together to improve the efficiency of the employment dispute system. These investments are on top of c.£50m the Government provided last year for the Advice, Conciliation and Arbitration Service (Acas). Acas is an impartial independent organisation whose remit is to promote good employment relations, advise employers and employees on workplace matters, and resolve individual and collective workplace disputes. The UK has a robust system for enforcing employment rights and the number of enforcement officers is just one aspect. The Government recognises the importance that effective and swift resolution of employment disputes plays in protecting the rights of workers.