NATIONAL MINIMUM WAGE
TUC welcomes closure of minimum wage loophole
The TUC has welcomed the announcement that the government will stop payments made into travel and subsistence tax relief schemes from counting towards the national minimum wage. The change will take effect on 1 January 2010.
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An earlier consultation uncovered abuse of these schemes by unscrupulous employers who have used these arrangements to avoid liability to pay national insurance contributions, says the TUC.
A final word
“This is welcome news. The minimum wage must provide a robust pay floor that supports vulnerable workers. In far too many cases travel and subsistence plans have been miss-sold to workers. Rogue employers have exploited these schemes to avoid paying national insurance and workers have ended up losing out on pension and sick pay entitlements, maternity pay and tax credits. The TUC is in favour of taxation that is fair and vigorous in application. Employers and workers have a clear duty to pay their fair share to the Exchequer. In return, the government's part of the contract is to deliver the high quality public services that we all need.” - Brendan Barber, General Secretary, TUC.
Want to know more?
Title: A Summary of Responses to National Minimum Wage Workers: Travel and subsistence expenses schemes, HM Treasury, July 2010.
Availability: You can download the 40-page document in PDF format at www.hm-treasury.gov.uk/consult_minimumwage_expenses.htm.
Read the TUC press release at www.tuc.org.uk/newsroom/tuc-18260-f0.cfm.
The TUC is the “voice of Britain at work”. With 58 affiliated unions representing nearly seven million working people from all walks of life, it campaigns for a fair deal at work and for social justice at home and abroad. For more details visit www.tuc.org.uk.