15 July 2014

Should employees be paid to sleep?

With the clocks changing and the dark nights drawing in, everyone begins to feel like the nights get longer and gloomier. This is particularly the case for care sector employers who, in an arena already stretched by tight cost margins, are re-evaluating their staffing costs for night cover shifts following a landmark Employment Appeal Tribunal case earlier this summer.

We reported in May 2014 the impact the case of Esparon t/a Middle West Residential Care Home v Slavikovska will have for care businesses providing sleep in services, either in care homes or at a service user’s property. The ruling means that where staff are required to be on site during the night due to a regulatory requirement they will most likely be found to be “at work” regardless of whether they are asleep or not and therefore are entitled to receive National Minimum Wage for the entire sleep-in period. The determining factor is whether it is essential for the staff member to be there, even if they do nothing. An example would be a regulatory requirement, such as set by the CQC.

It is not at present known whether there will be an appeal against the Esparon ruling. In the meantime, the decision is being lobbied at a national level.

With many care businesses paying staff a flat rate for sleep in shifts, commonly £25 per night, pay for a night’s sleep of 10 hours could more than double at NMW rate of £6.50 per hour for those staff whose circumstances mirror the ruling. An influx of claims from care workers is predicted.

Many care sector clients concerned by the ruling have contacted us with estimates that changing from a flat rate to NMW for sleep in shifts could increase their staff costs by upwards of £50,000 per annum. Clearly this is an area of immense concern in an sector where margins are already stretched.

Whilst interim measures to avoid spiralling costs if claims were to be lodged, such as how to crystalise the value of claims by making “stop the clock” payments, are being investigated by many affected businesses, it is hoped that the long awaited revisions to the NMW legislation will offer a solution favourable to business.

The NMW was introduced in 1999 and the original NMW Regulations have been amended more than 20 times. After some delay, in July 2014 the government published the draft National Minimum Wage (Consolidation) Regulations for consultation, which closed on 15 September 2014. Once the responses have been considered, it is intended that draft consolidated regulations will be laid before Parliament by early 2015, with the regulations coming into force later next year. We are not aware of any suggestion that the general election will have any bearing on this particular piece of legislation.

Under the draft consolidated regulations (which could potentially still change), regulation 32 is the provision regarding sleep at work. It provides that time work (for which workers should receive NMW) includes hours when a worker is available and required to be available, at or near a place of work for the purposes of working unless the worker is at home. It defines “available” as only including hours when the worker is awake for the purposes of working, even if a worker by arrangement sleeps at or near a place of work and the employer provides suitable facilities for sleeping.

It appears that this provision, if it is enacted in this current form, will greatly assist care providers to mount the argument that sleeping during a sleep-in shift is not working time as whilst the worker is technically available because they are on-call, they are not required to be awake. Only time when they are awake (i.e. if they are woken for the purposes of carrying out work) will be working time. It appears that the provision is drafted to make it apparent that if a worker is required to be on site, but is not required to be awake, then that does not count towards working time and NMW is not payable for time spent sleeping.

If you are a care business and concerned about the impact of the Esparon ruling and wish to discuss what it means for you please contact Stephenie Malone at smalone@hcrlaw.com.

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About the Author
Stephenie Malone, Senior Associate Solicitor
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