Carers are often required to sleep over and be “on call” at a care recipient’s home (for example a care home or sheltered housing), because the person they are caring for may require assistance during the night. However, a recent Employment Appeal Tribunal case may now mean that carers (and other workers) are entitled to be paid at least the National Minimum Wage (NMW) or National Living Wage (NLW) during the whole of these sleep-in shifts. This is in contrast to previous case law which drew a distinction between times when a worker was merely “available” for work, but not actually working, and when a worker is in fact working for the whole of their sleep-in shift, in which case they were entitled to be paid the NMW or NLW for the whole of their sleep-in shift.

It has been the case that many workers have been paid at a lower rate than the NMW/NLW for a night time shift, for example, a flat sum for each period of presumed rest and then an hourly rate for any time they are woken. However, a recent decision of the Employment Appeal Tribunal (EAT) contradicts this position and may mean that employers are now liable to pay their staff the National Minimum Wage (NMW) for the whole of the time they are sleeping in and may also face a back-payment liability of up to 6 years.

In the conjoined appeals of Focus Care Agency Ltd v Roberts; Frudd v The Partington Group Ltd; Royal Mencap Society v Tomlinson-Blake the EAT held that a ‘sleep-in night worker’ who was on standby to assist a ‘waking night worker’ in a care home, a carer who slept in at a patients home on call, and an on site warden at a caravan park were all entitled to be paid NMW or NLW for the whole of their night shift regardless of whether they were awake or not.

The EAT has suggested that a multifactorial test should be considered to determine whether an employee is entitled to NMW or NLW for the whole of a sleep in period. The factors the EAT suggest are:

  • Whether there is a regulatory requirement to have someone present at all times, which will indicate a worker is working simply by being present;

 

  • To what extent are the worker’s activities restricted by the requirement to be present and at the disposal of the employer;

 

  • The degree of responsibility undertaken by the worker and the types of activities that they may be called upon to perform; and

 

  • The immediacy of the requirement to provide services if something untoward occurs or an emergency arises.

The EAT has made clear that each case will turn on its own facts and so it will be important that employers ensure that each factor is considered carefully in order that staff are not paid less than the NMW or NLW.

As a result of the EAT decision, the Department for Business, Energy and Industrial Strategy (BEIS) has released new guidance stating that: “A worker who is found to be working, even though they are asleep, is entitled to the National Minimum Wage or National Living Wage for the entire time they are at work”.

The EAT decision may have a profound effect and pose a severe challenge to the social care sector where workers are commonly asked to sleep-in. Following their appeal, Mencap said they would pay staff the NMW/NLW for the whole of the time they are sleeping-in, although they have suggested that this pledge will take the charity to the brink of insolvency. Many workers will now be considering whether they are entitled to request that their employer pays them for the whole of a sleep-in period rather than just the periods when they are woken.

This is a fast moving area of workplace law, which may yet be subject to further change as Mencap have been given permission to appeal the EAT decision to the Court of Appeal. However, employers should not ignore the EAT decision as their liability for underpayment may stretch back up to 6 years and HMRC have already started actively investigating care providers following the judgement, although they are reportedly suspending any enforcement action until 2 October 2017 to give time to allow discussions to take place. It is therefore important that employers understand the law and comply with it before 2 October in the in order to avoid being fined up to £20,000 per underpaid worker by the HMRC. We are able to advise employers on the implications of the decision on their business and how they can protect themselves.