When the law is an ass

All blog posts

3 minutes

By Adam Raphael

For an example of bureaucracy gone beserk, resulting in one of the Guide’s hotels being fined £17,000 for breaching a law it didn’t know existed, this story takes some beating. The Minister for Commerce should be ashamed.

The saga begins a couple of years ago when a French college in Limoges asked Headlam Hall, a hotel in Darlington, if they would take a few French catering students on a three-month placement so that they could improve their English and knowledge of hospitality. The college requested that they should not be paid, but instead get ‘board and lodgings’. In fact, the hotel, which has featured in the Guide for many years, gave the students some pocket money, lifts into town on their day off, free laundry and paid for all their travel in the UK.

‘We thought this was a great idea,’ said Headlam Hall’s owner, Thomas Robinson. And so it proved. Over three summers, the hotel hosted eight French students, who so loved the experience that two stayed on for an extra term during which time they went on to the normal payroll, and one returned the following year to join the hotel’s staff on a permanent basis.

Last year, however, government inspectors arrived and ruled that the hotel was in breach of the law by failing to pay the statutory minimum wage to the students. The government’s website states explicitly that British catering students on work experience, or European students funded by European Community funds, are exempt from the minimum wage legislation. But the bean counters, alias Her Majesty’s Customs and Excise, ruled that Headlam Hall was not exempt because it had entered into a private arrangement with the French catering college.

How the hotel was meant to know this, goodness only knows. When I searched the government’s website for the relevant information. I did not find it. Nor did Headlam Hall. Its ignorance of the law has meant that the hotel has had to pay the students retrospectively, and pay a fine to HMRC, in total £15,000, a large sum for a small, family-run business. HMRC said the fine would be doubled if the hotel failed to pay within a month. If that was not bad enough, the government’s ‘naming and shaming’ policy for businesses that breach the wage rules resulted in a flood of damaging publicity which in turned provoked a barrage of online social media comment along the lines of: ‘Don’t ever go to this hotel as they exploit their workers – disgusting!’

Let me make clear, I am a supporter of Minimum Wage legislation. It has done more to lift low-paid workers out of poverty than any other government measure in the past decade. But the law must be enforced sensibly if it is to command respect. The Minister for Commerce, Margot James, who has now been moved sideways in the latest reshuffle, ignored the hotel’s appeal to her.

Headlam Hall’s owner, Thomas Robinson is understandably bitter. ‘So much for trying to encourage the development of young students in our industry’ he says. My drive to run a business in this country is waning, especially when this comes in the same year as an increase in our business rates of over £30000 p.a.‘ The result of all this is that the arrangement with the French college has ended, much to its and its students dismay as they cannot understand a rule that effectively discriminates against foreign students in a supposedly open labour market. It is not the law, poorly drafted though it may be, that is at fault. It is those who enforce it by draconian fines without common sense who are the real asses.