HMRC issues warning to seasonal Christmas workers

The tax authority is advising workers to ‘check your pay’ over the holidays, especially seasonal staff on short-term contracts

HMRC has urged those working over the Christmas period to ensure they aren’t being shortchanged by employers for the hours they put in.

The tax authority is advising workers to “check your pay” over the holidays, especially seasonal staff on short-term contracts that often become available during this time.

All workers by law must receive at least the national minimum or living wage (depending on age). This applies whether they are seasonal, full-time, part-time or students – without exception.

But in 2024/25, HMRC identified wage arrears of £5.8m due to 25,200 underpaid UK workers and issued around 750 penalties totalling £4.2m to non-compliant employers.

HMRC has urged those working over the Christmas period to ensure they aren’t being shortchanged (Getty)

The minimum hourly wage that an employer must pay depends on a worker’s age. The current rates, which will apply this Christmas, are:

• £12.21 – Age 21 and over (national living wage)
• £10.00 – Age 18 to 20
• £7.55 – Age under 18
• £7.55 – Apprentice (aged under 19/aged 19 or over and in the first year of their apprenticeship)

Anyone not receiving the correct pay is advised to report it to HMRC online. This can also be done on behalf of someone else. The tax authority says the process takes around five minutes and can be done at any time, including after the employment has ended.

For those who are unsure, the government offers a minimum wage calculator for employers and employees to check that the necessary amount is being paid.

Seasonal roles often become available in retail, hotels, Christmas markets, bars, restaurants, garden centres, warehouses and more (Drazen - stock.adobe.com)

Employers who break minimum wage rules can face penalties of up to 200 per cent of the underpayments owed to workers, on top of the obligation to pay the outstanding arrears back.

There are a number of ways in which employers can underpay employees, and not all are obvious. This can include not paying them for overtime worked, counting tips as part of their pay, and not paying the correct rate after a birthday takes them into a new bracket.

Employers are also not allowed to deduct the cost of workwear or tools from an employee’s wages if it takes them below the minimum wage, or cease paying them while they travel between work locations (commuting not included).

Kevin Hubbard, HMRC director of individuals and small business compliance, said: “We want to make sure that workers are paid correctly this Christmas. People should check their hourly rate and look out for any deductions or unpaid working time, which could take them below the minimum wage.

“Always make sure that you check your pay. If you think you have been shortchanged, even if you no longer work for the employer, we are here to help.”