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Employees losing almost £3bn a year

View profile for Sally Morris
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Recent research has found that British workers lose almost £3bn a year in unpaid wages and holiday, with recruitment agencies being amongst the most likely to be wrongly paying staff.

According to a report from Middlesex University, which forms part of the Unpaid Britain project, there were some 23,000 occasions last year where workers were not paid £2.7bn they were entitled to by their employers. 

This amount comprised £1.2bn in wages and £1.5bn in unpaid holiday.  It also included incidences where the underpayments were so severe that the employees were unable to afford necessities such as food.

The research also uncovered the fact that one in 12 workers were not receiving payslips and one in 20 received no paid holidays whatsoever, both of which breach the UK’s employment laws.

The industries most likely to pay their staff incorrectly, according to the report, were sports activities, amusement and recreation, food and beverage services and recruitment agencies.

Worryingly, the reports authors believe that the figures could be “the tip of the iceberg”, so now is the time to improve workers’ protection and give better guidance on employees’ rights.Business lobby groups agree that employees need greater protection, with a spokesman for the CIPD saying that the research highlights the need for the Government to run a “know your rights” campaign.

Meanwhile, according to a spokesman for the Resolution Foundation, the scale of illegal underpayment of wages is a big living standards concern, particularly as it is concentrated on the bottom end of the labour market.  He added that the UK’s employment regime must be updated to fit with the modern world of work.