Government cuts rights of modern slavery victims to recover compensation from their traffickers

In the past, the greatest amount of compensation for victims of trafficking has been recovered under the National Minimum Wage in the Employment Tribunal. In our recent high profile case of Tirkey v Chandok a woman who has been held in servitude for 4.5 years, working seven days a week was awarded over £183,000 National Minimum Wage back pay from the Tribunal. 

Unfortunately, this core right - the right to claim the National Minimum Wage or indeed any payment at all – has been drastically reduced. Ironically, during the passage of the Modern Slavery Bill, the government introduced a restriction on the right to recover the National Minimum Wage. 

From July 2015, the Deduction from Wages (Limitation) Regulations 2014 prevented anyone from claiming more than two years National Minimum Wage owed. ATLEU has experience of bringing cases for people held in servitude for over 10 years. 

This new restriction, whilst not aimed at victims of trafficking, is likely to impact overwhelmingly upon them. It will affect only those who are not paid the National Minimum Wage (or indeed not paid at all) for a period of more than two years. By definition someone who has worked without pay for over two years is very likely to be a victim of modern slavery.

The government carried out an impact assessment on the new Regulations but there was no mention of the effect on victims of trafficking and modern slavery. Accordingly we have no reason to believe that the government addressed its mind to victims of trafficking.

The impact assessment asserted that HMRC are currently enforcing National minimum wage claims so, in effect, the right of the victim to bring a claim in the Tribunal is otiose. However, according to HMRC’s own figures, the average recovery for the National Minimum Wage back pay is £205 which strongly indicates that few or no recoveries are made for those with underpayments going back over two years.

ATLEU is campaigning to reintroduce the right of victims to recover the National Minimum Wage and is actively considering a legal challenge to the Regulations.