You may have aware from recent media reporting that Mencap, a learning disability charity, has agreed to pay staff who carry out sleep-in shifts the national minimum wage (NMW), despite previously claiming that that such an undertaking would take it to the brink of insolvency. Its decision follows the Judgment of the Employment Appeal Tribunal (EAT) in April this year, which upheld the earlier decision of an employment tribunal: that the charity may be required to pay its sleep-in staff the NMW even when they are asleep and not carrying out any duties.
Mencap’s approach is a radical departure from standard practice in the care sector, where sleep-in staff have traditionally received a flat sum for a sleep-in shift and then a minimum hourly rate for when they are awake and carrying out their duties. However, this recent EAT decision has reconfirmed that workers working night shifts must be paid NMW where they are allowed to sleep, as long as they are at work and undertaking certain work-related responsibilities.
In addition to the EAT’s decision HMRC has recently ruled that carers sleeping overnight should be paid the national minimum wage for all hours and they are now pursuing enforcement measures, including back pay demands for up to six years, against care organisations who have not paid NMW or above for all hours worked (including sleep-in shifts).
What enforcement measures can HMRC take?
It is a criminal offence to refuse or wilfully neglect to pay NMW to your employees/workers.
Enforcement measures available to HMRC include:
– Service of notices of underpayment: this sets out the arrears of NMW to be repaid, together with a requirement for the employer to pay a financial penalty to the secretary of state within 28 days. On 1 April 2016, the financial penalty was increased to 200% of the total underpayment. The overall maximum penalty is £20,000 per underpaid worker;
– “Naming and shaming” those businesses who fail to pay the NMW via a Department for Business, Energy, & Industrial Strategy press notice;
– Recovery of underpayment through the tribunals or civil courts; and
– Criminal prosecution
The enforcement action by the HMRC is in addition to action that the worker can take themselves, such as a claim in the employment tribunal for unlawful deduction from wages.
Mecap have been granted leave to appeal to the Court of Appeal by the EAT, so we are likely to see lots of media coverage on this topic in the future, however, for now the law is clear – you must pay your workers at least NMW for sleep-in’s.