The Supreme Court has dismissed the appeals of two care workers who argued they should be paid the minimum wage for the whole of a "sleep in" shift
The National Minimum Wage Regulations 2015 provide that workers are entitled to be paid for hours when they are not actually working but where they are "available, and required to be available, at or near a place of work for the purposes of working". This is subject to two exceptions, the first of which is when they are at home (the "at home exception") because their home is near the workplace. The second is the "sleep-in exception". This covers a situation where a worker sleeps by arrangement at or near the place of work and is provided by the employer with suitable facilities for sleeping. The case law on when the sleep-in exception applies has been inconsistent. This inconsistency has now been addressed by the Supreme Court in Royal Mencap Society v Tomlinson-Blake.
The judgment actually deals with two claims which had been heard separately in the employment tribunal and the Employment Appeal Tribunal (EAT), but which were heard together in the Court of Appeal. Both claimants, who were expected to sleep for most of their shifts but who could be woken if their assistance was needed, were paid a fixed sum for the shift. In both cases the claimants were very rarely woken during the shift. The first claimant, Ms Tomlinson-Blake, was also paid an additional hour's pay and the second, Mr Shannon, received free accommodation in addition to the fixed sum. Both claimed they were underpaid on the basis that the whole shift constituted hours they should be paid for. Although they had met differing degrees of success in the early stages of their claims - Ms Tomlison-Blake having been successful - the Court of Appeal had found in favour of the employers. The claimants were not entitled to be paid for the time they spent asleep. Both claimants appealed to the Supreme Court.
In deciding the case the Supreme Court went back to basics and examined the "mischief to which the regulations were directed". That meant examining the recommendations made in the Low Pay Commission reports when the NMW was first introduced. That included a recommendation that, while workers on a sleep-in shift should be entitled to NMW when they are awake and required to be available for work, they should continue to agree their pay for periods where they were asleep without the need to apply the NMW rates. The UK Government at the time had accepted that recommendation. Taking this into consideration the Supreme Court concluded that the correct interpretation of the NMW Regulations was that workers on a sleep in shift only required to be paid for the period which they are actually awake for the purpose of working. In reaching their conclusion the Supreme Court overruled earlier Court of Appeal, Court of Session and EAT authorities to the contrary.
This judgment will come as a relief to many care providers who would have faced significant extra costs going forward, and significant back pay liabilities, had the decision gone the other way. However, employers will need to ensure they have systems in place that accurately record time spent working during sleep-in shifts so workers' pay does not fall below NMW levels. The judgment also leaves some significant issues to be resolved, not least for care providers who have been paying NMW for every hour of sleep-in shifts. Where this is or has become a contractual entitlement employers will not simply be able to reduce pay in consequence of the judgment. Attempting to do so, even via appropriate consultation with workers, may well give rise to significant employee relations issues, and possibly more tribunal claims.
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