Care Providers & the National Minimum Wage

This blog is aimed at Care Provider Legal Solutions Policyholders and agents who specialise in the care sector. I would like to share with you a Government briefing document that summarises recent developments relating to payment of the national minimum wage for sleep-in care duties. Here is a link to the document and my summary is below. 

Back ground

The Royal Mencap Society v Tomlinson-Blake case considered whether sleeping during a shift should be deemed as “work” for the purpose of applying National Minimum Wage (NMW) regulations.

In April 2017 the Employment Appeal Tribunal handed down judgment which, held that, in some cases, carers who are required to be present throughout the night will be entitled to the NMW whether awake or asleep. The briefing document summarises this case and others. 

Consequences of breaching NMW

To obtain backdated wages if underpaid, an employee can take a claim to the employment tribunal or the country court. If a worker is successful in his NMW claim, he could be owed up to six years’ back pay. HMRC enforces the NMW on behalf of the Department for Business, Energy and Industrial Strategy (BEIS). If HMRC finds that an employer has underpaid worker(s), it will fine the employer, require it to provide back pay to affected workers, and name and shame them via a press release.

Relief for social care employers

Given the potential impact on the social care sector the HMRC has, until 31 March 2019, modified its approach to enforcement by launching the Social Care Compliance Scheme (SCCS). Subject to certain criteria, employers who have opted into the scheme can have financial penalties in relation to under payment of sleep-in shifts prior to 26 July 2017 waived and will escape “public naming and shaming”.  Details of the SCCS scheme are here. https://www.gov.uk/guidance/tell-hmrc-if-youve-underpaid-national-minimum-wage-in-the-social-care-sector
Nothing in the scheme prevents individual workers taking their own legal action (whether in the Employment Tribunal or Court) to recover arrears owing to them.

Staying compliant

No single factor is determinative and the weight each factor carries (if any) will vary according to the facts of the particular case however a key point is that “where specific hours at a particular place are required, upon the pain of discipline if they are not spent at that place, and the worker is at the disposal of the employer during that period, it will normally constitute time work”.
The briefing note sets out potentially relevant factors in determining whether a person is working by being present. Full enforcement guidance is here.   https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/656568/nmw-enforcement-beis_-_policy_doc_-_full_vFINAL__3_.pdf

Tailored cover gives competitive edge

The demographics underlying the continuing growth of care providers are becoming so familiar that many brokers are in active competition for this business. ARAG has just introduced Care Provider Legal Solutions*, an expertly designed product to give specialist brokers the edge over conventional commercial legal expenses policies. The new product has been built around ARAG’s own claims experience over the past decade and extensive consultation with specialist agents.

Care providers come in all shapes and sizes and any of them can be subject to rigorous investigation. The new policy acknowledges this, whether assistance is given on a residential or nursing home basis, or through other registered premises including where cared-for individuals live in their own homes.

ARAG can now offer representation for care providers at coroners’ courts or fatal accident inquiries, Quality Care Commission investigations and registration disputes, Charity Commissioner appeals (plus Scottish and NI equivalents), and even 24/7 in the case of interviews under caution. Additional legal defence is available for allegations of dishonesty or violent acts. All this on top of what might be expected under the ARAG Essential Business Legal policy.

A further benefit recognises that care providers can suffer significant long-term damage to their reputation, so the crisis communications aspect of cover has been substantially increased, to £25,000.
The background to this burgeoning market is that the greater part of 10 million people aged 65+ have a long-term illness that affects their activities. Of the 1.3 million aged over 85, more than 70% have a long-term illness. During the past 25 years, the number of people in this latter category has doubled, and is expected to more than double again to 3.1 million in a similar time frame. Around a million older people and those with disabilities already live in care homes or have care provided in their own homes.

* Care Provider Legal Solutions is available under delegated authority arrangements. Where LEI is bundled as a mandatory cover the wider features may be given under the Absolute Business Legal policy.

Introducing Care Providers' Legal Solutions

Does your legal expenses provider consistently design products around the needs of your customers?

The Office of National Statistics has just released coroners’ statistics for 2016 and the headline figures certainly support the introduction of legal protection for Care Providers. Our new product features a raft of covers which focus on the needs of the Care sector, including legal protection to represent care providers throughout Coroners’ inquests.  

Here are some key figures from 2016:

·         241,211 deaths were reported to coroners, the highest to date. This shows an increase of 2% from 2015.

·         The number of inquests opened increased by 5,769 to 38,626 (up 18%) driven by the increase in deaths while subject to DoLS.

·         Inquest cases represented 16% of all deaths reported to coroners, an increase of 2% over 2015.

·         40,504 inquest conclusions were recorded – this is an increase of 14% on 2015. 

·         There were 11,376 deaths of individuals subject to DoLS – and increase of 58% over 2015 and representing 5% of all deaths reported to coroners.

·         The percentage of inquests completed relating to persons aged 65 or over has increased from 61% to 66%. The ONS suggests that this may be due to the increase in the number of deaths of individuals subject to DoLS authorisations all of which require an inquest and may predominantly relate to the older population. 

Link to full report, ONS  Coroners’ statistics 2016  England & Wales https://www.gov.uk/government/statistics/coroners-statistics-2016