Bosses who fail to pay their employees the national minimum wage face tough fines under a government crackdown.
The Department of Trade and Industry (DTI) said it would launch a fresh assault on employers who broke the law.
Included in a consultation unveiled by secretary of state Alistair Darling is a proposal to issue companies with fixed penalty fines linked to the number of workers affected.
It has also been suggested that, as well as the fine, businesses should be compelled to reimburse under-paid staff with interest.
"Paying less than the minimum isn't only unfair to the workers - it's unfair to the vast majority of employers who obey the law, because it lets rogue businesses undercut them," Mr Darling said.
"I want to give this simple message to bad employers: pay less than the minimum wage and it will cost you.
"The vast majority obey the law already," he added.
The minimum wage currently stands at £5.35 per hour for workers aged 22 and over.
Employers failing to meet the requirement to pay their staff the minimum wage are issued with an enforcement notice and fine if they fail to comply.
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