Two north hotels have been named and shamed by the UK Government for failing to pay their lowest paid staff the minimum wage.
The George Hotel in Inveraray, run by Inveraray Inn Ltd, failed to pay £2,934 to 25 workers.
While The Tongue Hotel, in Sutherland, under the previous ownership of LDH Hotels Ltd, failed to pay £771 to 11 workers.
The companies were two of 202 UK employers found to have shortchanged their workers by £5 million in a breach of national minimum wage law, leaving around 63,000 workers out of pocket.
Hotels respond to HMRC investigation
The businesses have since had to pay back what they owe to staff and also faced financial penalties.
Highland Coast Hotels chief executive Guy Crawford issued a statement clarifying the underpayment was due to actions of the previous owner.
He said: “Tongue Hotel is now under the new ownership of Highland Coast Hotels, which is an accredited Living Wage Employer.
“Living Wage accreditation formally recognises and celebrates employers like Highland Coast Hotels who choose to go further than the government minimum.
“We’re working hard to be an employer of choice and offering career opportunities and not just employment.
“Highland Coast Hotels has made a significant investment in Tongue Hotel since taking it over in 2022.
“Earlier this year, we re-opened the hotel following a £800,000 makeover and we’re already welcoming visitors from across Scotland, the rest of the UK and beyond.”
‘Make no sense to bend pay rates’
Inveraray Inn Ltd owner Kris Clark said his company was found “not guilty” of any underpayment and argued it should not have been on the list.
He said: “I was fined for lending money to employees when they were in need. This was administered without a single penny of gain to myself or the business.
“The lending repayment rate was agreed by the staff and myself at a rate suitable to their incomes.
“I was fined £10,000 for deducting the loan at the net pay stage.
“We were not found guilty of any underpayment in regards to the actual minimum pay rate paid to staff, in fact we pay more than the going rate and take great care of our very important employees.
“We are a sixth generation family run business central to our community and it would make no sense to bend the pay rates for a couple of thousand pounds of gain and lose reputation and standing within the community.
“It materialised the other way where I lost £16,000 in fines and employee repayments.”
Big companies on list
Companies named range from multinational businesses and large high street names to SMEs and sole traders.
WH Smith failed to pay £1,017,693 to 17,607 workers, Lloyds Pharmacy failed to pay £903,307 to 7,916 workers and Marks and Spencer was due £578,391 to 5,363 workers.
Other Scottish companies named and shamed included Loganair who failed to pay £24,367 to 43 workers, The House of Bruar in Perth, failed to pay £5,544 to 57 workers and Macdonald Hotels £16,112 to 64 workers.
Minister for enterprise, markets and small business Kevin Hollinrake said: “Paying the legal minimum wage is non-negotiable and all businesses, whatever their size, should know better than to short-change hard-working staff.
“Most businesses do the right thing and look after their employees, but we’re sending a clear message to the minority who ignore the law: pay your staff properly or you’ll face the consequences.”
‘Calling out businesses’
The named and shamed employers underpaid workers in a number of ways, including deducting pay from wages, failed to pay workers correctly for their working time while some paid the incorrect apprenticeship rate.
Malcolm Offord UK government minister for Scotland said: “The minimum wage is an important guarantee for workers and this Government is upholding that standard by calling out businesses – regardless of their size – who fail to pay up. We will not see people short-changed for their hard work.
“By naming the firms, we are underlining the fact that paying the national minimum wage is not optional – it’s a legal requirement.”
The investigations by Her Majesty’s Revenue and Customs concluded between 2017 and 2019.
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