Proposals and consultations

Employment Memo 2007 Newsletter Issue 2

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PROPOSALS AND CONSULTATIONS

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Proposals and consultations

Right to work: Consultation on implementation of new powers

¶780 The Government has powers under the Immigration Asylum and Nationality Act 2006 to introduce fines and new policing measures in order to prevent illegal migrants from working. The Government is consulting on the implementation of new penalties for employers who employ illegal migrants, including:

– civil penalties of up to £10,000 per worker illegally employed;

– imprisonment for up to 2 years or an unlimited fine for procuring fraudulent identity documents;

– imprisonment for up to 2 years or an unlimited fine for knowingly employing an illegal migrant worker;

– disbarment as a company director for knowingly employing an illegal migrant worker; and

– imprisonment for up to 2 years or an unlimited fine for facilitation or trafficking.

The text of the consultation is available on the Border and Immigration Agency website, www.bia.homeoffice.gsi.gov.uk. It closes on 7 August 2007.

Right to minimum wage: Employment Simplification Bill

¶2868, ¶39 In general, a worker’s average hourly rate must be no less than the national minimum wage. Certain workers are however excepted from this protection, including students on sandwich courses, teacher trainees on work experience, family members working for a family business, voluntary workers and volunteers. Voluntary workers are workers employed in the voluntary sector who receive no monetary payment beyond subsistence or other expenses. Volunteers are workers in any sector who are under no obligation to perform work or provide services, and offer their time and effort for free, although they may receive reimbursement by way of expenses.

The government is now consulting on new proposals to extend the definition of voluntary workers, in order to include workers on certain government schemes, voluntary instructors in the army and volunteers for specified educational charities. The text of the consultation is available at www.berr.gov.uk/consultations. It closes on 4 September 2007. Parliament’s draft legislative programme for 2007–08 includes the Employment Simplification Bill. This among other things may seek to clarify provisions in the NMW Act relating to voluntary workers, depending on the outcome of current consultation which closes on 4 September.

¶¶2903+ Where a worker who qualifies for the National Minimum Wage (NMW) is remunerated by his employer at a rate which is less than the NMW, the worker can bring a claim for an unauthorised deduction from wages (¶3050). Arrears are calculated as the difference between the remuneration received by the worker and the NMW rate applying at the time they should have been paid. The worker may not claim interest. As a result, workers who bring a successful claim receive compensation which has less real worth than they would have received if the correct payment had been made at the outset.

The Government is therefore consulting on proposals to introduce “fair arrears”, which might include an interest component, or sums fixed by a percentage of the claim, or additional compensation at a fixed rate. The text of the consultation is available on the BERR (previously DTI) website, www.berr.gov.uk/consultations. It closes on 8 August 2007. Further to this, Parliament’s draft legislative programme for 2007–08 includes the Employment Simplification Bill. This among other things will seek to clarify and strengthen the enforcement framework for the NMW, specifically through the introduction of a straightforward penalty that can be levied against all non compliant businesses and a fairer method of calculating arrears.