Step-by-step guide to reporting NMW underpayment to HMRC — including what to expect, your rights, and the penalties employers face.
Before reporting, work out exactly how much you believe you are owed. Use our Minimum Wage Calculator to find the correct NMW rate for your age and the year in question. Multiply the shortfall per hour by the hours you worked in each affected pay period. Keep a note of the total amount owed and for which dates — HMRC can investigate up to 6 years of records so be as thorough as possible.
Strong evidence makes your complaint much easier for HMRC to act on. Collect as much of the following as you can: payslips for affected periods, bank statements showing amounts received, your employment contract or written terms, rota schedules or timesheets, any emails or messages about your hours or pay, and your own records (diary, phone notes, clocking-in records). You do not need all of these — even partial evidence is helpful.
You are not required to approach your employer before reporting to HMRC, but doing so sometimes resolves the issue faster. Write to your employer (email or letter) clearly stating the amount you believe you are owed and why. Keep a copy. If you are concerned about retaliation, skip this step — UK law protects you from being dismissed or penalised for asserting your NMW rights. ACAS can also facilitate early conciliation at no cost: visit acas.org.uk.
You can report NMW underpayment to HMRC in two ways. Online: visit gov.uk/minimum-wage-underentitled and complete the Pay and Work Rights complaint form. By phone: call the HMRC pay and work rights helpline on 0300 123 1100 (Monday–Friday, 8am–6pm). You can report anonymously if you wish — HMRC will not disclose your identity to your employer without your consent. Provide as much detail as you can: employer name, address, pay rates, hours, and dates.
Once a complaint is received, HMRC's National Minimum Wage enforcement team assesses it and decides whether to open a formal investigation. If they do, an HMRC officer may visit the employer's premises, request payroll records, interview workers, and check records going back up to 6 years. The investigation is conducted independently — you do not need to take any further action unless HMRC contacts you for additional information. Investigations typically take several months depending on complexity.
If HMRC finds that NMW was not paid, they issue a Notice of Underpayment requiring the employer to pay all arrears to affected workers — calculated at current NMW rates, not the rates at the time of underpayment (which can mean a higher total). The employer also faces financial penalties. In serious or repeated cases, employers can be named publicly on the government's "name and shame" list and face criminal prosecution. Back pay must be paid directly to the worker.
Online: gov.uk/minimum-wage-underentitled
Phone: 0300 123 1100 (Mon–Fri, 8am–6pm)
Anonymous reporting: Yes — HMRC will not reveal your identity to your employer without your permission. You can report on behalf of someone else.
Website: acas.org.uk
Phone: 0300 123 1100
ACAS provides free, impartial advice on employment rights and can help with early conciliation before an employment tribunal claim. Particularly useful if you also have related unfair dismissal or detriment claims.
Website: citizensadvice.org.uk
Free in-person and online advice on employment rights, benefits and consumer issues. Local bureaux can help you understand your rights and prepare a complaint. No appointment needed at many locations.
When HMRC finds evidence of NMW underpayment, employers face significant financial and reputational consequences. These penalties are designed to deter non-compliance and compensate affected workers.
| Offence | Penalty |
|---|---|
| Underpayment found | 200% of total arrears owed (minimum £100 per worker) |
| Named and shamed | Published on gov.uk public naming list — reputational damage |
| Criminal prosecution | Up to £20,000 fine per worker for wilful non-compliance |
| Repeat or serious non-compliance | Banned from acting as a company director for up to 15 years |
| Failure to keep NMW records | Separate civil penalty; HMRC can take employer to court |
Penalty amounts are halved if the employer pays within 14 days of receiving the notice. Arrears are calculated at current NMW rates (not historical rates), which typically results in a higher total owed.
Under the National Minimum Wage Act 1998 and the Employment Rights Act 1996, it is automatically unfair to dismiss you or subject you to any detriment (demotion, reduced hours, harassment) because you have asserted your right to the National Minimum Wage — or because you have reported a violation to HMRC or another authority.
This protection applies from day one of employment — there is no qualifying period. If your employer retaliates against you for reporting NMW underpayment, you can bring an automatic unfair dismissal claim or a detriment claim to an employment tribunal. Compensation for automatic unfair dismissal is uncapped where the dismissal is related to a whistleblowing act.
If you are concerned about retaliation before reporting, you can report anonymously to HMRC — they will not reveal your identity to the employer without your consent.