A company director, who supplied manual labourers to a farm, has been banned for seven years after repeatedly failing to pay his workers the national minimum wage – cutting them out of nearly £69,000 in earnings.
Euro Contractors Services, operating much like a recruitment service, made the farm pay a fee for the supply of workers before the firm paid the labourers and took a percentage for administrative costs.
Shakil Ahmed, who was Director of the firm, will have a seven year ban that will last from 22 May 2018.
It’s been a long time coming. The initial investigation launched by HMRC into Euro Contracts Services took place in 2009.
They found that the farm labourers weren’t being paid the national minimum wage, so workers were losing out on nearly £69,000.
In response to the investigation, Euro Contracts Services paid the correct wage to the farm labourers but then they deducted the transportation costs of workers getting to the farm. This meant that the workers’ pay was below the national minimum wage.
Ahmed then corrected this underpayment.
HMRC carried out another investigation two years later, between August 2010 and January 2011, where they found that Euro Contracts Services had paid 246 employees below the minimum wage, racking up to more than £110,000.
Ahmed then launched an appeal against HMRC’s findings, but the case was dismissed in court.
However, this time he didn’t rectify the underpayment like he had done previously.
As the money owed was never paid to workers, HMRC lodged a claim against Euro Contracts Services in December 2015 to recover the money that was still owed.
The money remained unpaid and Euro Contracts Services entered Creditors Voluntary Liquidation (CVL), a month before the full hearing which was set for September 2016, so the money owed to the workers was never paid.
Yet Ahmed is not the only recruitment Director underpaying. Nearly 180 employers were named and shamed by the Government for underpaying thousands of minimum wage workers in March 2018.
And the recruitment industry did not do well in this list. Best Connection Group topped the shameful run-through of underpayers. The Midlands-based recruiter had failed to pay a staggering £469,273.83 to 2558 workers.
The Government found that, in total, more than 9,000 employers underpaid minimum wage workers by £1.1million.