Named and Shamed: Hospitality Employers in HMRC NMW Naming Rounds

Mitchells & Butlers. PizzaExpress. Wagamama. J D Wetherspoon. Shepherd Neame. Hilton. Prezzo. Every one of them appears on a GOV.UK page listing employers that underpaid the National Minimum Wage. Each has payroll software, HR teams, and legal advisers on retainer. HMRC still found the shortfall first, in a calculation the employer's own systems should have caught.

The naming scheme has now published 23 rounds over more than two decades, and the last four of them tell the story.

The scale of recent rounds

Round 20 (February 2024) named 524 employers owing nearly £16 million to over 172,000 workers. Mitchells & Butlers appeared with £565,095 in arrears across 16,187 workers. Stonegate Pub Company owed £101,045 to 3,650.

Round 21 (May 2025) named 518 employers. £7.4 million in arrears. Nearly 60,000 workers affected. PizzaExpress owed £760,702 to 8,470 workers. Prezzo owed £163,703 to 2,550. J D Wetherspoon appeared for £7,000 across 282 workers.

Round 22 (October 2025) named around 491 employers. Shepherd Neame: £18,686 to 942 workers. City Pub Group: £45,183 to 88. Crieff Hydro: £33,993 to 131.

Round 23 landed on 19 March 2026, the last release before the Fair Work Agency takes over. It named 389 employers owing £7.3 million in back pay to roughly 60,000 workers, alongside £12.6 million in financial penalties. It is the first naming-round press release co-published by the Department for Business and Trade, HMRC, and the Fair Work Agency, signalling the handover. The government has committed to more frequent rounds from now on.

How hospitality gets caught

The Round 21 educational bulletin breaks down the causes. Of the 518 employers named, 34% were caught by deductions or reductions that pulled pay below the floor (178 cases). 31% were caught by unpaid working time (161 cases). 22% paid apprentices the wrong rate, and 31 employers got the accommodation offset wrong. The categories overlap. An employer can appear in more than one. But the top two tell the story.

Uniforms and dress codes. Wagamama was named in 2018 for requiring front-of-house staff to wear black jeans with their branded top. The cost of buying those jeans counted as a deduction from NMW-eligible pay. Wagamama repaid £133,212 to 2,630 workers. TGI Friday's was named in the same round for requiring black shoes: £59,348 to 2,302 workers. WH Smith repaid over £1 million to 17,607 workers after staff were required to buy own-range clothing.

The rule: any cost a worker incurs to meet a compulsory dress code is a deemed deduction from their pay. If that deduction pulls their effective hourly rate below the NMW floor in any single pay reference period, it is a breach. Doesn't matter if the item lasts two years.

Unpaid working time. Pre-shift briefings, post-shift cashing up, changing into uniform, mandatory training done at home, trial shifts. HMRC counts all of it. If those hours aren't paid, the effective hourly rate for that pay period drops below the floor.

Accommodation offset errors. Pubs and hotels with live-in staff can offset up to £11.10 per day (from April 2026) against NMW. Charge more and the excess counts as a deduction. Utility charges must be included within the offset, not added on top. Thirty-one employers in Round 21 got this wrong. See our employment records resources for the full calculation.

Salary sacrifice. Cycle-to-work, childcare vouchers, additional pension contributions all reduce gross pay for NMW purposes. A worker on exactly £12.71 per hour has zero headroom. Any sacrifice takes them below the floor. HMRC's published enforcement direction treats underpayments caused solely by salary sacrifice with a lighter touch on penalty and naming than other breaches, but the pay-reference-period calculation still records a breach.

The price of being named

The financial penalty is up to 200% of the arrears owed, capped at £20,000 per worker. There is a narrow escape route on the financial side. A Notice of Underpayment can be paid within 14 days for a 50% reduction on the penalty, and an employer has 28 days to lodge a formal objection. Miss the window and the full penalty runs. For large employers with thousands of affected workers, the aggregate runs into hundreds of thousands regardless. Mitchells & Butlers' arrears alone exceeded half a million pounds, and the penalty sits on top.

For most of the operators on the list, the money is the smaller of the two problems. The list is public. It includes the employer's name, the number of workers underpaid, and the total arrears. Trade press picks it up the same day. The list stays on GOV.UK indefinitely. There is no mechanism to get your name removed, and an employer can be named more than once if it receives multiple Notices of Underpayment. For a pub group trying to recruit, that search result outlasts the fine.

Technical breach, not deliberate exploitation

Look at the names. These are not employers who set out to underpay. Wagamama's statement after being named in the 2018 round: "We didn't realise that asking our front of house staff to wear casual black jeans or skirt was considered as asking them to buy a form of uniform." TGI Friday's was reimbursing shoe costs, but the reimbursement timing meant underpayment occurred in specific pay reference periods.

The pattern across every round is the same. A payroll system calculates the headline rate correctly, but does not account for the deductions, unpaid time, or benefit-in-kind adjustments that the NMW calculation actually requires. The per-pay-period maths fails even when the annual figures look right.

The direction of travel

DBT's 2024/25 enforcement evidence report, published 5 November 2025, records that HMRC opened 5,207 NMW cases in the year to 31 March 2025 and closed 4,764, with arrears turning up in 1,161 of them. DBT puts the 2024/25 strike rate at 36%, up from 30% the year before. Average arrears per underpaid worker hit £229, up 57% on the £146 figure from the previous year, the highest recorded since 2015/16. Three investigations ended in criminal prosecution. Since the scheme began in 1999, HMRC has identified over £199 million in arrears, issued over £105 million in financial penalties, and completed more than 99,000 investigations.

The naming list skews toward the size of operator the national press will recognise, even though the totals do not. DBT's 2024/25 supplementary tables break the arrears numbers down by employer size. Small and medium employers accounted for 1,071 of the 1,161 cases where arrears were found, at an average of about £3,350 per case, which works out at roughly £3.59 million in total. Large employers with 250 or more staff accounted for 90 cases at an average of about £24,367 per case, roughly £2.19 million in total. The per-case average at large employers is around seven times the SME figure, but the SME tail carries more of the national arrears bill in absolute terms. The 90 large cases supply most of the recognisable brand names that carry the round when each press release lands.

The Fair Work Agency takes over

From 7 April 2026, NMW enforcement transfers to the Fair Work Agency, an executive agency of the Department for Business and Trade. The underlying calculation does not move with it. The 200% penalty cap of £20,000 per worker, the 14-day fast-payment discount that halves a penalty, the six-year lookback window, and the recalculation of old arrears at the current NMW rate rather than the rate in force at the time of the underpayment all carry over intact. A £1 per hour shortfall from 2020, when the rate was £8.72, now comes out at about £1.46 at the April 2026 rate of £12.71, a 46% uplift on every old hour. Over six years of arrears, the compound effect on the oldest pay periods is the largest single amplifier on the final bill. The public naming scheme continues with the same list format and the same press distribution.

What changes is the machinery around it. The Fair Work Agency brings four existing bodies, the HMRC NMW Unit, the Gangmasters and Labour Abuse Authority, the Employment Agency Standards Inspectorate, and the Director of Labour Market Enforcement, into a single agency for the first time, so an employer that used to field separate letters from separate regulators now corresponds with one. The Employment Rights Act 2025 also gives FWA a statutory power to bring employment tribunal proceedings on behalf of workers directly, something HMRC did not have, although the operational rollout of that power is still being worked through. A regulation-making power in the same Act will eventually let FWA charge employers under enforcement action a cost-recovery fee, although the charging mechanics are not yet in force.

Some enforcement remit is being phased rather than switched on day one. Holiday pay and Statutory Sick Pay enforcement are scheduled to move across to FWA later, with the dates still to be confirmed. As of the week before launch, FWA had not published an enforcement policy statement covering inspection procedures, risk triggers, or records lists. HMRC officers are being designated as FWA Enforcement Officers and will continue to run NMW casework on FWA's behalf during the transition.

If you run hospitality payroll today, none of this changes the calculation that has to survive a pay-reference-period audit. The same deductions, the same unpaid minutes at the start and end of shift, the same accommodation-offset maths still decide whether a worker crossed the £12.71 floor. What has changed is which agency's letterhead arrives when the audit goes the wrong way, and how many adjacent enforcement powers sit in the envelope behind it.