EAT considers whether sleep-in shifts count as “time work” for national minimum wage purposes
The Employment Appeal Tribunal has considered whether night shift workers who sleep in, in order to carry out duties if required, engage in “time work” for the duration of the shifts, and therefore are entitled to the National Minimum Wage for this time, or whether they are only entitled to be paid the National Minimum Wage when they are awake and carrying out their duties. The Employment Appeal Tribunal considered three appeals and found that a multi-factorial evaluation is appropriate to determine whether a worker is working merely by being present at their workplace (even if asleep).
The Employment Appeal Tribunal set out four potentially relevant factors to be considered.
Firstly, the employers particular purpose in engaging the worker. For example, a regulatory requirement to have someone present at all times during the night may indicate that the worker is working simply by being present.
Secondly, the extent to which the worker’s activities are restricted by a requirement of the employer to be present and at its disposal. This may include a consideration of whether the worker could be disciplined if they left their post during their shift or whether the worker would be replaced if they did so.
Thirdly, the degree of responsibility undertaken by the worker and the types of activities that they may be called upon to perform. This distinguishes, for example, a limited degree of responsibility and sleeping-in in order to call out emergency services in the case of a break-in or a fire on the one hand, and a night sleeper in the home of a disabled person where a heavier personal responsibility is placed on the worker in relation to duties that may have to be performed during the night.
Finally, the fourth factor the Employment Appeal Tribunal considered was relevant was the immediacy of the requirement to provide services if something untoward occurred or an emergency arose. This seeks to distinguish whether someone has responsibility for intervening or deciding to intervene or whether the worker simply is there to be woken as and when needed by another.
Crucially, although unhelpfully for the purposes of certainty, the Employment Appeal Tribunal emphasised each case is likely to turn on its own facts. In one of the particular cases under appeal, a care worker supporting vulnerable adults worked a sleep-in shift during which no specific tasks were allocated but there was a continuing obligation to remain on the premises and listen out for any incidents that needed dealing with. The Employment Appeal Tribunal upheld the previous finding at the Employment Tribunal that the carer was performing time work throughout her shift. Crucially, the carer was required to be present and would have been disciplined if she had left her post, which would have put the employer in breach of its legal obligations.
Whilst the Employment Appeal Tribunal’s consideration of these cases is helpful in providing some guidance on the approach that the Courts are likely to take in considering whether an individual who performs sleep-in shifts is entitled to the National Minimum Wage for the whole period of the sleep-in shifts, it does not provide the certainty as to when the National Minimum Wage will apply that employers would have wished.
Those in the health and social care sector will be aware that HMRC are taking a considerably firmer line on these issues than they have done previously. We are aware of a number of clients and contacts who have been subject to HMRC investigation in respect of payments for sleep-in shifts. We are involved in assisting clients in responding to those investigations and seeking to rebut, where appropriate, HMRC’s assertions that individuals are engaged in “time work” for sleep-in shifts. The multi-factorial approach set out above by the Employment Appeal Tribunal may now provide some assistance to clients and contacts in seeking to resist any HMRC investigation which alleges that staff undertaking sleep-in shifts are engaged in “time work”.
Further, the Employment Appeal Tribunal did not consider the potential argument that sleep-in shifts could constitute “unmeasured work” under the National Minimum Wage regulations. This argument was not pursued before the Employment Appeal Tribunal but could be put forward where workers are paid a flat rate and an “unmeasured work” arrangement allows the number of hours the worker is likely to spend working to be predetermined by a written daily average agreement. In these circumstances only the agreed realistic average of the hours likely to be spent carrying out duties whilst undertaking “unmeasured work” will count towards calculations of the National Minimum Wage. This argument remains untested before the Court but may provide an alternative structure for payments for sleep-ins.
For more information on the issues raised above, please contact a member of the Employment team.