Number of workers paid less than minimum wage jumps

The number of people paid less than the minimum wage has surged by almost a third over the last year, fuelling fears that employers are dodging the new higher rate.

The number of people paid less than the minimum wage has surged by almost a third over the last year, fuelling fears that employers are dodging the new higher rate.

Official figures showed 330,000 earned less than the legal limit this year, a 32 per cent jump from the 250,000 recorded a year ago. The survey of low pay by the Office for National Statistics is the first since the minimum was put up by 10 per cent to £4.10 an hour, and £3.50 for those under 22 years old.

The latest figures from the Department of Trade and Industry show employers underpaid staff by £5m last year, a rise of £2m over just one year.

Alastair Hatchett, a labour expert at the analysts Incomes Data Services, said the rise tallied with government figures showing a rise in non-compliance. He said it could also be due to restaurant staff being paid less than the minimum in the expectation they would make up the difference in tips.

John Monks, TUC general secretary, said it was too early to say whether people were being underpaid but added: "There is no cause for complacency and we need to keep up pressure so that there is no hiding place for Scrooge bosses."

The Confederation of British Industry said the law exempted some people who received free accommodation or were apprentices or trainees. John Cridland, its deputy director general, said the figures were "suspiciously high" but insisted business was not complacent. "Cowboy employers that don't pay the minimum wage are not doing anyone any favours," he said.

Meanwhile, separate figures showed the pay gap between men and women had risen because of growing inequality in the earnings of City professionals. Women earned 81.1 per cent of what their male counterparts did, compared with 81.5 per cent last year, the ONS said. A narrowing of the pay gap for most workers was offset by a large rise in inequality in the top 2 per cent of the pay scale.