The Court of Appeal has today issued a judgment that will have wide ranging implications for the care and other sectors relying on staff to provide sleep in cover.
The issue was whether workers who were required to "sleep in" to provide assistance if it was required are entitled to be paid at the appropriate national minimum wage rate for every hour of that sleep in shift - even if no work is actually performed.
The Court of Appeal made it clear that under the National Minimum Wage Regulations, workers are either available for work or actually working. Those who provide sleep in cover are only available to work and are only entitled to be paid if they do work during a shift. So, if a worker gets up in the night to help a patient, they are entitled to paid for that time, but not any other time when they are in bed or resting. This decision clarifies what has become a very complicated area of the law and will be welcomed by care homes across the UK who will not now be exposed to historical allegations that they have underpaid staff which, many argued, would put them out of business.
In 2017, the government changed its guidance on NMW and sleep in shifts and argued that any worker who provided sleep in cover and was responsible for dealing with emergencies etc was entitled to be paid for each hour of their shift - even if they were asleep the whole time. That guidance is clearly now wrong.
At the same time HMRC encouraged employers to sign up to its Social Care Compliance scheme to declare how much they had underpaid staff for sleep in shifts in exchange for not receiving stiff penalties of up to £20,000 per worker or being publicly named for underpayment of National Minimum Wage. To be accepted onto the scheme, employers had to repay up to six years in underpaid NMW - and many simply couldn't afford to do so.
Many employers have already changed the terms and conditions of their staff to make sure that they did receive the appropriate NMW rates for undertaking sleep in shifts. They will not be able to amend these unless their staff agree (which is unlikely to be forthcoming). But new staff are unlikely to receive enhanced rates for sleep in shifts and will probably receive a set amount calculated to include time when they might actually be required to work.
Employers were told to fund £400 million of back pay but care providers, including Mencap, argued that this was unaffordable. The Court of Appeal ruled today that care providers had no liability for back pay.