This Section makes provision for the penalties that a notice of underpayment must include.
	Subsection (1) states that a notice of underpayment must require the liable party to pay a penalty to the Secretary of State (subject to the next Section).
	Subsection (2) states the penalty must be paid before the end of the 28-day period beginning with the day the notice was given.
	Subsections (3) to (6), read together, set out the amount of the penalty that the liable party is required to pay. Subsections (3) and (4) state that the penalty is calculated by reference to the total amounts owed to each underpaid individual to whom the notice relates and is 200% of the sum specified in the notice of underpayment as the sum due to that individual on the relevant day.
	Subsection (5) provides that if the amount determined under subsection (4) is greater than £20,000 then the amount considered when calculating the penalty is to be £20,000. Subsection (6) sets out that if a penalty calculated in subsection (3) will be less than £100, the penalty specified in the notice is to be £100.
	Subsection (7) provides that the Secretary of State may, by regulations, amend the amounts and percentages set out in this Section.
	Subsection (8) states that regulations under subsection (7) are subject to the affirmative resolution procedure.
Part 5: Enforcement of Labour Market Legislation Notice of Underpayment Section 107 – Penalties for underpayment