National Minimum Wage: what the latest naming and shaming tells employers about the Fair Work Agency

George Newton, Trainee (Admitted Solicitor) in the Employment Team has considered what this press release, and recent enforcement means for employers across the country and also the broader implications of the new Fair Work Agency which is currently in its foundation year. This was the Fair Work Agency’s first report since its creation in April 2026, with HMRC continuing to carry out some of the functions up until April 2027, and it did not hold back on naming and shaming some big names. 

What does the latest National Minimum Wage enforcement action mean for employers?

So, who was named and shamed?

The list of employers was extensive and ranged from small businesses and surprisingly to household names such as Tesco, B&Q, Leeds United Football Club, Majestic Wine, Five Guys and NHS organisations. Four law firms were mentioned too. It is not necessarily the case that employers were deliberately underpaying their staff. What is certainly a factor is that compliance with the National Minimum Wage regulations and pay overall can be extremely technical and oversights can arise from a wide range of circumstances such as:

• Miscalculations on salary sacrifice schemes;

• Not accounting for all applicable working time;

• Tips and service charge payments;

• Deductions for employer-provided items such as uniforms; 

• Not using the correct rate for a change in age or even a change of apprenticeship scheme; 

• Travel time

What is the current legislation for National Minimum Wage?

The current National Minimum Wage and National Living Wage for workers aged 21 and over is £12.71 an hour. It may appear simple from an outsider’s perspective to ensure employees are paid in line with this, if applicable, but as outlined above even sophisticated employers with large support resources can get this wrong. 

In truth it is not always as simple as an employer just paying the correct hourly rate set by legislation, sometimes certain payments, hours, deductions and other intricacies need to be taking into account. Employers must consider compliance with other legislation surrounding salary sacrifices, training and travel for example. 

The Chair of the Fair Work Agency Advisory Board Matthew Taylor has outlined that employers “who fall short should expect robust enforcement…”. Therefore, employers should seek legal advice from experienced employment solicitors regarding their obligations to help them avoid financial penalties and consider steps to streamline internal processes. 

It is important that employers ensure they are regularly reviewing their compliance with the National Minimum Wage and have routine checks in place to avoid employees falling through the net.

What are the consequences of a breach of National Minimum Wage compliance?

An employer that has been found to have underpaid their employees may be liable to pay more than just simply the wages in arrears. There may also be a financial penalty attached to a Notice of Underpayment. A Notice of Underpayment has a long limit of 6 years meaning employers may be required to cover arrears for several years. The penalties on top of this can mount up as the typical calculation is around 200% of the underpayment with a minimum penalty of £100. There is a maximum penalty of a staggering £20,000 per worker and is therefore imperative employers are complying with National Minimum Wage regulations to avoid large and unnecessary costs. 

Is the list as bad as it looks?

Not necessarily and the headlines can be quite misleading. 

In particular the number of workers affected by the underpayments can paint a bit of a different picture for certain employers. For example, Five Guys underpaid 3,699 workers owing a total of £54,642 and if averaged across these workers would work out to around £15 per employee.

In comparison St George's, Epsom and St Helier Hospital Group owed a total of £123,332 across only 75 employees, which works out to roughly £1,644 per employee if averaged across that number. This illustrates the significant difference that the number of affected workers can make when considering the headline figures.

The list therefore should not be viewed as a league table which ranks the worst offending employers in terms of National Minimum Wage compliance. The circumstances of each case can vary considerably as can the number of workers affected and also the level of arrears owed. The list and the published figures represent the total arrears identified in each case and should not be view in isolation and subsequently taken as an indication of the relative level of culpability of the employer. 

Although in saying that, the list does highlight specific sectors which are populated with a greater number of offenders. The sectors in the spotlight are those in the care, retail, hospitality and cleaning industries. Typically, you would associate a lot of these employees being paid on or around the minimum wage and therefore discrepancies in payroll can instantly become National Minimum Wage breaches the scale of which can be expansive with thousands of potential affected employees. 

How can employees raise a National Minimum Wage claim?

The government’s report provides useful information for how both employees and employers can stay on top of National Minimum Wage legislation with employees able to visit gov.uk/checkyourpay and employers able to use the government calculator via: Calculating the minimum wage - Guidance - GOV.UK..

Employees can raise the issue with their employer in the first instance but can also consider bringing a claim in the Employment Tribunal. Employers should also be aware that HMRC can investigate suspected underpayments and require the employer to produce relevant records. The Employment Rights Act 2025 is increasing time limits to bring claims from 1 October 2026 and transferring the enforcement into the new Fair Work Agency framework. 

Who is the Fair Work Agency and what are they going to enforce?

The Fair Work Agency was created by the Employment Rights Act 2025 and was established in April 2026. The agency was created to help consolidate enforcement of key employment rights which includes investigating employers, issuing penalties, bringing tribunal claims and providing general guidance. 

The Fair Work Agency has powers to inspect workplaces as well as make demands for records and compliance evidence and they can issue penalties for breaches of relevant employment rights as we have seen for companies like Tesco.

The Fair Work Agency’s will not just be limited National Minimum Wage enforcement and in due course it will take on the primary role of enforcement of additional employment rights including statutory holiday and sick pay.

As an employer what should you do now?

Employers can expect future scrutiny from the Fair Work Agency and continuation of the naming rounds, although there is no set precedent on when these come out or how regularly. The most recent publication was the 24^th addition and the first under the new Fair Work Agency and employers can expect public reporting to continue, albeit not in a fixed timetable of naming rounds, as the priorities for the Fair Work Agency have outlined. 

The Minister for the Future of Work Kate Dearden MP has also outlined that “Every employer should check their payroll now and reach out to ACAS if they need further support.”. Employers should be conducting payroll and internal audits, especially those who operate with staff close to the National Minimum Wage. Internal reviews of applicable age and apprentice rates, overtime, holiday pay and working time vs travel time should all be points of concern.

How can Thackray Williams help?

Thackray Williams can advise both employees and employers and we have extensive experience advising on National Minimum Wage, holiday pay, payroll deductions and Employment Tribunal claims.

If you are an employer and you have general questions or you have concerns regarding your organisation’s compliance we can assist you by reviewing your arrangements and advising on areas of risk before they become a dispute or an enforcement problem.

For further information, please contact a member of our Employment team on 020 8290 0440.