21 February 2019 
Caroline Jones, Employment tax director
Many of you may read the previous article relating to Iceland Foods (Iceland) and HMRC’s contention that Iceland had breached National Minimum Wage (NMW) by allowing its employees to voluntarily participate in a work-place savings scheme. Earlier this month an Employment Appeal Tribunal (EAT) at Teeside Magistrates’ Court, found that Middlesbrough FC did not breach minimum wage legislation after deducting the costs of season tickets from staff.
In Middlesbrough’s case it had deducted the cost of season tickets for the 2016-17 season from employees’ wages over several weeks. It is understood that the money deducted was in the region of £2,000 and HMRC contended, that by making these deductions Middlesbrough had breached NMW requirements. It was argued that by spreading the money for season tickets out over several weeks, and at the employees’ requests the club was simply doing its staff a favour.
As in Iceland’s case HMRC’s argument was that the employer had the benefit and use of the season ticket payments and as such they had breached the NME legislation. The judge agreed with Middlesbrough that it had not paid staff below NMW and the EAT found that the deductions made were permitted under the legislation.
The business secretary, Greg Clark has already said that he would consider changes to the law “when evidence shows that rules unnecessarily penalise employers, and that changing them will not reduce the protection offered to low-paid workers”. He also highlighted salary sacrifice schemes as an area of concern and called for further information to help the government decide whether changes needed to be made. Given the current ongoing consultation into NMW we may see some changes announced later this year in relation to these complex areas.
