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A potential crisis in the care industry has been averted with a court of appeal ruling that employers don’t have to pay workers national minimum wage when they are on sleepover shifts, provided workers are “expected to sleep”.
The decision means that national minimum wage is payable only when staff are awake and working or only have “permission to sleep” not the expectation to.
Sleepover shifts are common in the care sector, and the industry faced potential back pay claims in the region of £400 million if the court had decided that employees had to be paid national minimum wage for any and all sleepover shifts.
Sleepover shifts and national minimum wage
The issue considered by the court of appeal was how time spent by a worker on a sleepover shift should be treated for national minimum wage purposes given that the worker could be asleep for most, if not all, of that shift.
A sleepover shift is where a worker is contractually obliged to spend the night at or near their workplace on the basis that they are expected (this is a key term) to sleep for all or most of the period but may be woken if required to undertake some specific activity.
Often in these situations a care provider will pay a modest lump sum to cover the sleepover shift as a whole (notably less than the national minimum wage for the whole period) and will then pay additional sums for any time spent awake and working. The prospect of a decision that every hour “worked” should be treated as working time for national minimum wage purposes was unsettling for many employers in the care industry, not to mention potentially very expensive.
‘Expected to sleep’ v ‘permission to sleep’
The court of appeal has provided some much needed clarity by drawing a clear distinction between where a worker is expected to sleep and where a worker has permission to sleep.
It is a fundamental aspect of many sleepover shifts that the worker will be asleep during the shift unless they are called upon to perform their duties. Under the court of appeal decision, in this scenario the worker is only entitled to national minimum wage during periods when they have actually been woken for work. At this point the clock starts ticking for national minimum wage purposes for as long as they are fulfilling their duties. That clock is not ticking whilst the worker is asleep.
Where there is only the mere permission to sleep, for example, where the worker can sleep once they have completed the specific tasks assigned to them they are treated as working for the entire shift for national minimum wage purposes, regardless of whether they are asleep.
An overarching payment for this type of shift would be a breach of national minimum wage legislation unless it was equal to, or greater, than the appropriate national minimum wage rate for every hour of the shift.
Update employment contracts
Following the helpful distinction between the expectation of sleep and the mere permission to sleep it is crucial that employers should ensure that their employment contracts properly record what the actual expectations are.
If a worker is going to undertake a sleepover shift where they are expected to sleep unless called upon to perform their duties then this should be stipulated in the contract. This will allow the employer to limit the “working time” for national minimum wage purposes to when the worker is actually awake and working.
Chris Morse is a legal executive in the HRExpress team at Stephens Scown. The team offers HR and employment law support and solutions to small and medium sized organisations, helping them to develop an engaged, effective and productive workforce. For more information, please call Chris on 01872 265100, email employment@stephens-scown.co.uk or visit https://www.stephens-scown.co.uk/business/employment/hrexpress/
