A kind-hearted salon owner said she is ‘absolutely gutted’ after being included in a list of businesses that have failed to pay workers the national minimum wage.
The government ‘named and shamed’ Havant-based Headromance in its list of 179 employers accused of underpaying staff.
The Business Department revealed that company, on Park Road, failed to pay £2,959.64 to 9 workers.
However founder Emily Warne said the underpayments are easily explained.
Emily said appearing in the list is ‘utterly disheartening’ and an ‘unfair smear’ on her business, after her team worked hard to appeal the decision.
She said: ‘Two months ago I received an email to say that Headromance would be appearing on the list.
‘I was shocked because we are completely innocent. I really care about my staff. I know it’s cliché, but we are one big family.’
When Emily first started the firm with her ex-business partner, the pair could not afford to hire an accountant and took care of the finances themselves.
Emily said: ‘You could call us naive but I was only 24 and the government don’t help you. The “missing” money is from 2003, so we had forgotten all about it.’
‘One of our employees needed a loan to buy a car, we loaned her the money and deducted repayments from her wages. To the government, we now know this looks like we’re underpaying staff. In the same breath, staff might ask for an advance in wages or to borrow money for a holiday. Each time we would lend the money and then deduct it from their wages over a course of however many months because it worked for them. We were just trying to help.’
If a staff member wanted new equipment, management would buy what was needed and arrange repayment through the employee’s next paycheck.
She said: ‘Each one of these so-called underpayments can be explained. We were simply trying to help our staff.’
However, after explaining the situation to the government and appealing the decision to list her company, Emily received an email to say that the appeal had been rejected.
She said: ‘They told me that unless there is risk to someone’s life or a matter of national security, the appeal will not be accepted.’
Emily was forced to pay her staff members the money the government believed to be owed. She was then slapped with a hefty fine.
She added: ‘My staff couldn’t believe it. I had to give them the money and then pay the government. We’re a small, independent business and we give a lot back to our team and the community but we’re being treated like common criminals.’
As Emily paid her staff the money quickly, the government reduced the fine to £3,000.
Staff member Sasha Francis said: ‘I have worked here for a long time and I can confirm that the staff have always been treated with respect. Emily goes above and beyond to make sure that we have what we need and that we’re happy so I think it’s shocking and unfair. We really feel for her.’
Emily said: ‘I now have an accountant to arrange our finances which is a weight off my mind, but I feel we’ve been unfairly smeared by the government. We haven’t gone out of our way to underpay staff. We’ve always filed and submitted our documents on time. I invest a lot of money in the team, paying for employees to train across the globe, putting them on regular courses and buying their equipment.’
The company is still ‘reeling’ from the experience and Emily said it’s a shame that she now has to be cautious before helping her staff.
She said: ‘You think, as a business owner, that the government is there to help you. Actually, they’re more interested in punishing you.’