The fine comes on top of rules forcing businesses to pay wages arrears if they're caught underpaying staff. More than £3 million in unpaid wages was given to 25,000 workers last year.

Paymaster-General Dawn Primarolo said:

"The vast majority of employers are honest and scrupulous but this new measure will put further pressure on those rogue employers who continue to flout the law."

Under the new rules, if a complaint about an employer is upheld by an HM Revenue & Customs (HMRC) investigation, the employer will have seven days to repay the arrears - or face the fine.