Workers are entitled to the NMW (or national living wage for over 25s) for every hour they work, which is assessed by looking at their average hourly pay across the pay reference period. However, it is not always easy to determine how many hours a worker is actually working, particularly in relation to sleep-in shifts. Importantly, if a worker is ‘working’ simply by being present, the whole of their shift will be taken into account when considering whether they have received the NMW. If the worker is not ‘working’ merely by being present and is provided with sleeping arrangements (or is ‘at home’), only the time spent performing tasks will be counted.
In Focus Care Agency Ltd v Roberts, the EAT identified relevant factors:
1. The employer's particular purpose in engaging the worker – is the employer subject to a regulatory or contractual requirement to have someone present?
2. The extent to which the worker's activities are restricted by the requirement to be present – will the worker be disciplined if they slip away to do something else?
3. The worker's degree of responsibility – does the worker merely have to call the emergency services if required or do they have more responsibility (eg a night sleeper in a care home for the disabled)?
4. The immediacy of the requirement to provide services – does the worker have immediate responsibility for intervening or are they only woken when needed by another worker?
This list is not exhaustive, no single factor is determinative and the weight attributed to each factor will vary from case to case.
Interim Enforcement – ‘Sleep-in’ shifts
HMRC announced the provisions which will be in place for employers within the social care sector from 1 November 2017.These provisions include the opportunity for social care employers to opt-in to the Social Care Compliance Scheme (SCCS) where underpayments for sleep-in shifts have been made.
Employers who join the scheme will be required to calculate their underpayments of the NMW (with assistance from HMRC – apparently once an employer has joined the scheme they will receive a booklet with advice and setting out the formulas required to calculate the underpayments), and will need to return their declaration of their underpayment within 12 months (or by 31 December 2018 if sooner). Employers will then be required to pay employees any underpayment within 3 months, or by 31 March 2019, if sooner.
Those who comply with the SCCS requirements will not be subject to financial penalties and will not be eligible for naming and shaming as a business who failed to pay the national minimum wage.
Those who fail to opt-into the SCCS scheme will not be offered such concessions and may be subjected to full HMRC investigative processes for any sleep-in payment arrears accrued after 26 July 2017 with a possible result in public naming and prosecution.