Employment Rights Act 2025
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Change 1
107 Penalties for underpayment
(1) A notice of underpayment must require the liable party to pay a penalty to the Secretary of State. This is subject to section 108(1) (power to specify exceptions). (2) The penalty must be paid before the end of the period of 28 days beginning with the day on which the notice is given. (3) The amount of the penalty is the total of the amounts for each underpaid individual to whom the notice relates calculated in accordance with subsections (4) and (5) (but see subsection (6)). (4) The amount for each underpaid individual to whom the notice relates is 200% of the sum specified in the notice of underpayment as the sum due to the individual on the relevant day (see section 106(2)(b)). (5) But if the amount determined under subsection (4) for any underpaid individual would be more than £20,000, the amount for the individual taken into account in calculating the penalty is to be £20,000. (6) If a penalty calculated in accordance with subsection (3) would be less than £100, the amount of the penalty is to be £100. (7) The Secretary of State may by regulations amend this section— (a) so as to substitute a different percentage for a percentage for the time being specified in this section; (b) so as to substitute a different amount for an amount for the time being specified in this section; (c) so as to specify different percentages or amounts for different purposes. (8) Regulations under subsection (7) are subject to the affirmative resolution procedure.
107 Penalties for underpayment
(1) A notice of underpayment must require the liable party to pay a penalty to the Secretary of State. This is subject to section 108(1) (power to specify exceptions). (2) The penalty must be paid before the end of the period of 28 days beginning with the day on which the notice is given. (3) The amount of the penalty is the total of the amounts for each underpaid individual to whom the notice relates calculated in accordance with subsections (4) and (5) (but see subsection (6)). (4) The amount for each underpaid individual to whom the notice relates is 200% of the sum specified in the notice of underpayment as the sum due to the individual on the relevant day (see section 106(2)(b)). (5) But if the amount determined under subsection (4) for any underpaid individual would be more than £20,000, the amount for the individual taken into account in calculating the penalty is to be £20,000. (6) If a penalty calculated in accordance with subsection (3) would be less than £100, the amount of the penalty is to be £100. (7) The Secretary of State may by regulations amend this section— (a) so as to substitute a different percentage for a percentage for the time being specified in this section; (b) so as to substitute a different amount for an amount for the time being specified in this section; (c) so as to specify different percentages or amounts for different purposes. (8) Regulations under subsection (7) are subject to the affirmative resolution procedure.
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