Recruitment firms and popular UK retailers including WH Smith, Marks and Spencer and Argos are among more than 200 employers named and shamed by the UK government for failing to pay their lowest paid staff the minimum wage.

The 202 employers were found to have failed to pay their workers almost £5 million in a clear breach of National Minimum Wage (NMW) law, leaving around 63,000 workers out of pocket.

Recruitment firms and employment agencies on the list include: Tudor Employment Agency, Twenty Four Seven Recruitment Services, Elite Recruitment Agency Limited (now dissolved), and All Day Recruitment Limited.

The businesses named in yesterday’s list have since paid back what they owe to their staff and have also faced financial penalties. The investigations by His Majesty’s Revenue and Customs (HMRC) concluded between 2017 and 2019.

The employers had underpaid workers in the following ways: 39% of employers deducted pay from workers’ wages;  39% of employers failed to pay workers correctly for their working time;  21% of employers paid the incorrect apprenticeship rate.

“Whilst not all minimum wage underpayments are intentional, there is no excuse for underpaying workers,” the government stated.

 Minister for Enterprise, Markets and Small Business Kevin Hollinrake said, “Paying the legal minimum wage is non-negotiable and all businesses, whatever their size, should know better than to short-change hard-working staff.”

Bryan Sanderson Chair of the Low Pay Commission added, “The minimum wage acts as a guarantee to ensure all workers without exception receive a decent minimum standard of pay. Where employers break the law, they not only do a disservice to their staff but also undermine fair competition between businesses. Regular naming rounds should be a useful tool in raising awareness of underpayment and helping to protect minimum wage workers.”

WH Smith Retail Holdings Limited topped yesterday’s list with details showing that the retailer failed to pay £1,017,693.36 to 17,607 workers.

According to The Guardian, the company said the mis-payment was identified as part of a 2019 review by HMRC, which found WH Smith, along with several other retailers, had misinterpreted how statutory wage regulations applied to uniform policy for store staff. The group had asked workers to wear their own trousers, skirts or shoes in a specific colour, along with uniform it provided. WH Smith has paid them back an average £40 for money spent on the clothing items.

“This was a genuine error and it was rectified immediately with all colleagues reimbursed in 2019,” WH Smith said.

Lloyds Pharmacy and Marks and Spencer ranked second and third on the list, respectively. A spokesperson for Lloyds Pharmacy said the underpayment was unintentional and had reimbursed its workers.

Marks and Spencer said its underpayment was an ‘unintentional technical issue from over four years ago’ and was related to weekly payments to temporary workers. The company was found to owe 5,363 workers just over £100 each, or £578,000 in total. “This happened simply because temporary colleagues were not paid within the strict time periods specified in the national minimum wage regulations and was remedied as soon as we became aware of the issue,” it said.

A spokesperson for Argos, which ranked fourth on the list, said its violation dated back to 2012 before the supermarket bought the catalogue chain. It had launched an investigation and corrected the problem when it was first identified in 2018.

Since 2015, the budget for minimum wage enforcement has doubled with the government having ordered employers to repay over £100 million to 1 million workers.