Are on-call or sleep-in workers entitled to the national minimum wage (NMW) for their whole shift, or just the time they are awake and carrying out duties?

The central question: 'Working' or 'available'?

If an on-call or sleep-in worker is 'working' throughout their shift, then you need to pay the NMW for the duration of that shift. This applies even if they are at home, can sleep at some point during their shift, or have little or nothing to do during certain hours.

On the other hand, if a worker is simply required to be 'available', then you need to pay the NMW for all time when they are available at or near a place of work for the purposes of working unless one of the following applies:

  • They are at home. If they are at their own home and just need to be 'available', perhaps to respond to emergencies, you only need to pay the NMW for hours when they actually work, not the full duration of their on-call time (no matter whether they are awake or asleep).
  • They are sleeping. You don't need to pay for hours when the worker is asleep, even if they sleep at or near the workplace and you provide sleeping facilities.

How do we know if someone is 'working' or 'available'?

This will depend on the facts.

An example is the recent case of Royal Mencap Society v Tomlinson-Blake, in which the Court of Appeal decided that a sleep-in care worker was 'available' rather than 'working', meaning she was only entitled to the NMW whilst awake and carrying out duties, not for the duration of her 10pm to 7am sleep-in shift.

Ms Tomlinson-Blake provided support to vulnerable adults in their own homes. Mencap was obliged (via legislation and its contract with the local authority) to have someone on the premises throughout the night. During her shifts she:

  • had no specific tasks;
  • had to remain at the house;
  • slept in a bedroom and was expected to get a good night's sleep (particularly as she might be expected to work a dayshift the following day); and
  • had to keep a 'listening ear' during the night in case support was needed and intervene if necessary (for example, if the individual was unwell or distressed). The need to intervene was 'real but infrequent'.

Will the same apply to our sleep-in workers?

Mencap was decided on its own particular facts, and different circumstances could generate a different outcome. The Court of Appeal in Mencap tried to summarise the difference as:

  • Working: staff are working throughout their shifts, albeit that there are short lulls in activity during which they can sleep.
  • Available: the 'essence of the arrangement' is that staff are expected to sleep for all or most of the period but may be woken if required to undertake specific activities.

Applying this distinction won't always be straightforward in practice. Indeed, the Court recognised that there will be borderline cases, and that different tribunals might reach different decisions based on similar facts, which is not entirely helpful for employers who need to make a decision on their own arrangements.

Government compliance scheme – social care providers and sleep-in shifts

In light of the earlier Employment Appeal Tribunal (EAT) decision in Mencap – which found that the NMW was due throughout the sleep-in shifts – HMRC launched a Social Care Compliance Scheme for social care providers who had not routinely made these payments to help them meet their (perceived) liability for back payments.

Given that the Court of Appeal has now reversed the EAT's decision, it is unclear what will happen to that scheme. HMRC is considering the position and has indicated that it will provide information by 17 August 2018.

We increased sleep-in payments to NMW level – can we now reduce them?

If you pay the NMW for all hours of a sleep-in shift (and assuming your workers are 'available' rather than 'working') then legally whether you can reduce pay rates for existing workers will depend on the terms of their contracts, and you should take legal advice on your particular circumstances. For both existing and new workers, you will also need to consider:

  • Any potential impact on employee relations.
  • The market in which you are operating i.e. what impact would lower pay have on your ability to recruit and retain staff?
  • The terms of any contract to provide the service.
  • Any potential impact on future bids to provide services.

The Scottish Government has indicated its commitment in the past to all social care workers being paid the 'real living wage' (which is set at a higher rate than the NMW), and confirmed that this applied to sleepover hours. Whether this will change in light of Mencap is unclear at this time.

What now?

We don't yet know whether Mencap will be appealed to the Supreme Court, but this is possible.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.