Changes to National Minimum Wage enforcement in TUPE cases

Posted on August 30, 2018

HMRC has confirmed that with effect from 2 July 2018, where there has been a TUPE transfer of staff from one employer to another, all National Minimum Wage liabilities, including the full penalty amount, is to be applied to the new employer.  Historically, HMRC charged the former employer all or part of such penalties where the failure related to pre-transfer activities.  It will be important for anyone acquiring a business to get full disclosure of any potential liabilities, and to ensure that appropriate indemnities are agreed where possible.  This will help to avoid a situation of the new employer facing unexpected minimum wage fines without being able to claim such costs back from the old employer.