Wagamama's wage fine should serve as a warning to employers dodging the law

A happy Friday for workers at TGI Fridays. And Wagamama. They’re now getting paid what they’re owed.

That means the minimum wage, so it isn’t great. But every little helps. The back pay they’ve received through their employers flouting the rules will be welcome.

The words “error” and “inadvertent” were used in Wagamama’s response to being named and shamed by the Government.

The company had told front of house staff to wear black jeans or a black skirt with their Wagamama tops, which will have meant low paid staff had to go out and buy these things.

TGI Fridays’ problem was caused by shoes.

It’s not so much firms paying less than the headline rate that typically causes problems. It is, as in these instances, the clothes they want staff to wear coming out of their wages. Or it might be staff having to attend meetings or training sessions out of work hours. They might have to wait line to clock in, or spend unpaid time cashing out and locking up.

Companies like Wagamama and TGI Fridays employ HR people. They also often have lawyers available to help them. So there really is no excuse for not being aware of the rules, and how they related to staff uniforms, or anything else. One would hope this will serve as a case of lesson learned.

This column is no great fan of the current Government, but credit where it is due, the movement it has made on the subject of minimum wage enforcement has been welcome.

The budget for the latter has been raised significantly and cases pursued more actively.

Sadly, there are still too many of them. A report by the Low Pay Commission last year revealed that one in five minimum wage workers could be receiving less than they are entitled to. In actual numbers that amounts to as many as 580,000 people.

The problem, therefore, is a significant one, and a lot of bad practice is, even now, going undetected. It's not just as big companies like the two named restaurant chains either.

The civil regime that sees firms required by HM Revenue & Customs to reimburse staff on to top of fines of up to twice what they owe up to a maximum of £20,000 per worker, with money off if the back pay is handed over quickly, is a good one.

It’s fast, and it's cheap and the addition of the quarterly publication of the names of those hauled over the coals should prove particularly effective when it comes to big companies with brands to protect.

Unfortunately there is likely to be a long tail of smaller miscreants out there; firms who may be inclined carry on with bad practice the hopes that they don’t get caught. As such, it wouldn’t hurt to see a few prosecutions launched. Perversely the maximum penalties where they are successful are less than those available under HMRC's civil regime.

This is a rare area where the UK is moving in the right direction, and that’s something to be thankful for, but the latter is something ministers might care to address.