'Cash in Hand' Employment

**RichardSt** · 3rd Jun 2011, 10:02

I know that it is illegal for an employer to pay below the minimum wage if they pay employees officially through the books.

Is it illegal for an employee to accept cash in hand payment for working in the UK - cash in hand that equates to being below the minimum wage?

I suppose the real question that I would like answered is 'If an worker starts working in a restaurant that is paying cash in hand below the national minimum wage - if the worker gets caught (I don't suppose any tax will be being paid?) would this impact on any future visa applications?

**richardb** · 3rd Jun 2011, 10:53

http://www.direct.gov.uk/en/MoneyTax...ax/DG_10010537

"You can accept cash payments for work you do, but it's illegal for you not to declare this on a Self Assessment tax return, and pay Income Tax and National Insurance contributions if these are due. This will depend on your overall taxable income in the tax year."

What the employer is doing is much more serious.

Richard

**RichardSt** · 3rd Jun 2011, 11:09

Thanks Richard,

So in this case, if the weekly wage was below £102 per week (at which level no tax or N.I. is payable) then there is no risk - except to that of the employer.

I will again try to dig a little deeper - I'm not comfortable with this at all

**Linne** · 3rd Jun 2011, 11:09

I hate to get on the soap box. But it just lets the side down as it were for all those employers who play be the rules apart from the fact that its exploitation. Having said that I know of a few self employed folk who have effectively work for no wage at all in order to keep the business going.

Please don,t encourage this.

Dare I ask what kind of visa the person is on at the moment ?

**RichardSt** · 3rd Jun 2011, 11:20

I agree but am losing the battle on this one.

I probably have double standards myself - I would never even consider 'allowing' this if it related to full time, permanent work but a couple of evenings a week I'm not sure I have the strength to keep objecting (although I have been)

I also need to clarify if my understanding is 100% correct - maybe the wage is minimum wage and the working hours described include a break period that is not covered - £28 for 6 hours = £4.66 per hour; however £28 for 5 hours and 1 hour break = £5.60 (I know the minimum wage is currently £5.93) but maybe there is some loss in translation...

FLR(M) is the current visa

**John** · 3rd Jun 2011, 11:46

So in this case, if the weekly wage was below £102 per week (at which level no tax or N.I. is payable) then there is no risk - except to that of the employer.

£102 per week is now rather out-of-date. In fact for NI purposes, the 0% band for employees is now £139 per week, and for the employer £136 per week. And given for tax purposes the Personal Allowance is now £7475, that divided by 52 is £143.75 per week.

So picking on the lowest figure, anything up to £136 should not be a problem. (But if the employee has another job, the employer should be deducting 20% tax, irrespective of the amount.)

**maokaang** · 3rd Jun 2011, 12:01

Surely, if it is an employer/employee scenario, minimum wage requirements come into play?

**Tobias** · 3rd Jun 2011, 13:04

Originally Posted by maokaang

Surely, if it is an employer/employee scenario, minimum wage requirements come into play?

Absolutely.

**ddwjg** · 3rd Jun 2011, 14:09

RichardSt, I get the impression you are not talking about full time employment, but part time casual work. I think, if your wife is not getting wage slips, and she is happy with a little extra income, and in the long run it saves you money as well, I wouldn't be too bothered. Particularly if she is working for a Thai restaurant.

If you say no, and force her to sit at home bored to death, it may not auger well for your future relationship.

The legal advice you have requested above is all well and good, and absolutely spot on, but look at the bigger picture.
If as I suspect, this is a job in a Thai restaurant, your wife is probably getting all her food for nothing, and the odd other perk, like thai vegs at a cheaper price, to bring home, and able to have conversation with people of her own language.

If, at some stage they want to increase her hours, then I would consider asking them to put her on the books, and give her wage slis etc.

If you play this by the book, you already know she will not pay tax, and she will not be in trouble with any future visa, for comitting some cardinal sin, so what the heck.

If she can get a job with them, on the books, after she has proved herself, then she can get a Nat Ins No. and really start to work officially. I don't think this is exploitation, as such. a lot of the smaller Thai restaurants have not got big profit margins and it helps everyone all round. If she has not done restaurant work before, she is probably a bit like a trainee.

If my assumptions about Thai restaurant work are incorrect, that makes it a different ballgame.

Dave

**edcorkie** · 3rd Jun 2011, 14:48

Would an employee being paid cash have any employment rights? If injured in the workplace would they have any rights?

**RichardSt** · 3rd Jun 2011, 14:48

Hi Dave,

Yes you are correct, this is part time work in a Thai restaurant.

My complaint isn't the work per se; I hold the view that I am happy for my wife to do anything that she likes so long as it is legal and doesn't detract from anything else that I would like her to do. (I'm aware this could sound odd so let me elaborate...)

My wife certainly doesn't sit at home bored - she has been studying English at a private language school in Leeds for the last 9 months and has a further 3 months to run. My position is that I would prefer her to stay at this college learning English and focusing her attentions in this area full time until such time as she can get a 'real' job. No disrespect intended to anybody working in a restaurant or similar.

My real concern was that I didn't want my wife to take a short term 'gain' for something that could potentially cost us dear in the future - i.e. being refused ILR due to working illegally.

The job and the potentially salary do not put her directly in a compromising situation (it would appear) and so for the sake of a quiet life I can live with it......for now.

Hopefully when the next 3 months study are complete Su will try her luck with a few full time job applications and if we have no success then I think another spell at college would be the best use of our/her time and resources.

I do appreciate your comments

**Tobias** · 3rd Jun 2011, 15:21

Originally Posted by edcorkie

Would an employee being paid cash have any employment rights? If injured in the workplace would they have any rights?

Yes, they certainly would.

---------- Post added at 15:21 ---------- Previous post was at 15:16 ----------

Originally Posted by ddwjg

... I don't think this is exploitation, as such...

It most certainly is and it is illegal - and that could have a bearing on future applications to UKBA.

Originally Posted by ddwjg

... ... a lot of the smaller Thai restaurants have not got big profit margins and it helps everyone all round...

Completely irrelevant. It helps no one except the employer.

**RichardSt** · 3rd Jun 2011, 15:27

...so Tobias this COULD have an impact on future applications to UKBA?

i.e. the fact that I know that the employer is acting illegally by not paying minimum wage (if this is substantiated)

**Tobias** · 3rd Jun 2011, 15:37

If she only has this one job and the payment she receives is (and remains) below the threshold for Tax and NI contributions then there is no issue as no law is being breached. The only illegal activity is on the employer's part. Should she take up other employment or earn more than the Tax and NI threshold and hides that fact then she will be conspiring with the employer to commit a criminal offence as well as any other offences being committed under the Taxes Management Act.

That notwithstanding, such employment remains illegal to the extent that the minimum wage and all the other statutory provisions under, for example, the working time directive are not being given by the employer. It is pure exploitation.

**KhunIanB-UK** · 3rd Jun 2011, 16:02

"If, at some stage they want to increase her hours, then I would consider asking them to put her on the books, and give her wage slis etc."

I would ask them to put your wife on the books and do things all above board and then you have no worries, if they refuse then walk away. Explain to your wife the jeopardy that she may suffer if the place was raided by immigration looking for illegal workers etc, even if they were unable to do anything as she is not "illegal" it would be awkward questions asked and no doubt she would be asked to provide passport details etc (even if the employer has a copy).

I would also go as far as saying to the restaurant that you want all done above board in case of an immigration/illegal worker raid ;-) and it would be better for them to have official records for even casual employees due to the tens of thousands of pounds fines that could be issued ;-)

The other advantage for you would be the payslips, history of employment, NI contributions and who knows what future information requirements by the Home Office might be met by these.

**ddwjg** · 3rd Jun 2011, 17:38

KhunIanB-UK. You really think all that fuss is justifiable for doing a few hours 3 nights a week.

The nonsense about illegal immigrants working has absolutely nothing to do with this. If the place was raided, and she was full time and on the cards she would still be asked to provide her passport. What awkward questions? You are being very melodramatic.

So you demand all above board, and on the books, and they say sorry, we'll get somebody else.

Tobias has already said it is the employer, not the employee who is responsible for this, although he did confuse me, when he said it could have a bearing on future applications, and then qualified this by saying, should she take up other work, and knowingly conspire to hide her income.

RichardSt, I must agree that her college should not be jeopardised by a part time job. Now that is a different arguement.

Getting those qualifications is paramount to her future.

Dave.

**Linne** · 3rd Jun 2011, 19:10

Originally Posted by ddwjg

So you demand all above board, and on the books, and they say sorry, we'll get somebody else.

Its the law............the large restaurant chains can get it right Mcdonalds for instance.

http://payandworkrightscampaign.dire....uk/index.html Thai translators available.

Where do we draw the line. ??

**Jack** · 3rd Jun 2011, 20:27

If it doesn't feel right walk away, it's as simple as that

As has been said RichardSt's wife is ging to be okay and not in any trouble over a few hours a week. My main worry would be the distraction from college, if she can't concentrate on both, the course work has to come first.
As to the legality of what the employer is or is not proposing to do, up to him

hate that phrase but it suits here.
Thankfully the last few months have left me more or less employee less

and in this climate, that's the way it will stay.
As to what Linne said about self-employed working for effectively no wages, spot on, I can vouch for that

**colin244** · 3rd Jun 2011, 21:00

A while back before she got a proper job in the chicken factory for a very large food packing company the wife was working in a Greek run cafe and despite the verbally quoted salary all she got was half promised (cash in hand)

She left the next week

colin 244

**-Keith-** · 3rd Jun 2011, 23:02

I totally agree with Dave on this, if it's only for a couple of nights a week I don't see the issue. She'll probably get free food and a share of the tips on top of the agreed amount for her shift, so will probably take home more than the minimum wage.

If this practice is so illegal how come thousands of restaurants all over the country operate like this ?