As the care sector awaits the judgment following this week’s Supreme Court cases into sleep-in shifts, employment lawyers at Irwin Mitchell say that a new policy published by the government could reduce the fines faced by organisations if the Court of Appeal ruling is overruled.
The Supreme Court heard two cases sleep-in cases earlier this week (Tuesday and Wednesday February 11 & 12): Mencap v Tomlinson-Blake and Shannon v Rampersad. The judgements from these cases are not expected until around mid-May.
Both cases appealed a Court of Appeal ruling that said both care workers, Mr Shannon and Ms Tomlinson Blake, were only “available” to work during their sleep-in shifts (rather than actually working) and only had to be paid the National Minimum Wage (NMW) if they were asked to work during that time.
The care sector is bracing itself for costly penalties if the Supreme Court overrules this decision – but it appears that a new policy published by the government this week on HMRC enforcement, prosecutions and naming employers who break NMW law, will limit what organisations pay if they get it wrong.
Fergal Dowling, partner and head of employment law at legal firm Irwin Mitchell, said: “Although employers who underpay staff have to pay back arrears and a penalty up to £20,000 per worker calculated as a percentage of the arrears, the government can specify situations where HMRC shouldn’t impose a penalty. The Secretary of State has issued three directions, one of which relates to those employing staff to sleep in.
“It says that employers shouldn’t receive a penalty, even if they have underpaid staff where part of the payment relates to sleep-in shifts and to that part of the underpayment occurring in a pay reference period that ended before 26 July 2017.
“This suggests that if the Supreme Court reverse the Court of Appeal’s decision, underpaying employers won’t have all arrears included in the penalty calculation.”