Almost 2,800 workers in Birmingham were underpaid by £775,000 last year, HM Revenue and Customs (HMRC) has revealed as it approaches local employers to help prevent errors in salaries.

HMRC is writing to more than 8,000 employers in the Birmingham area to highlight common mistakes around the National Minimum Wage (NMW) and National Living Wage (NLW) – offering practical support to help them get it right and warning of the consequences of breaking the law.

Common mistakes include deductions or payments from items connected to the job, such as uniforms, not paying employees for the full time they have worked and not paying apprentices correctly.

The letters also signposts to further advice and contains a checklist for employers to work through to help identify any mistakes they are making.

Businesses failing to comply with minimum wage rules could face penalties of up to 200% of their arrears – plus having to pay the arrears owed to workers and may also be publicly named.

Marc Gill, Director of Individuals and Small Business Compliance at HMRC, said: “It is employers’ responsibility to ensure their workers get the pay they are due under minimum wage rules but we are here to support those who need information to get it right.

“Employers must pay the correct wage to their workers. Our information and checklist will help employers get it right first time, assist them in identifying any possible mistakes and make sure their staff are not losing out.”

Compliance work carried out last year found almost 2,800 Birmingham area workers had been underpaid £775,000.

Birmingham employers were handed penalties of more than £900,000 last year because they failed to comply with minimum wage rules.

HMRC is also offering some employers a free support call with one of their National Minimum Wage / National Living Wage experts. The National Living Wage is the minimum wage for those aged 23 and over.

The letters are timely with the recent increase to National Minimum Wage and National Living Wage rates from 1 April 2023.

In the summer, HMRC will be writing to workers in Birmingham asking them to report any concerns they may have about being underpaid the National Minimum Wage.