If the Courts uphold earlier Employment Tribunal and Employment Appeal Tribunal decisions it will leave care providers with an estimated £400m bill that will, says law firm Royds Withy King, push many into insolvency.
James Sage, Head of the Social Care team at Royds Withy King who specialises in advising care providers in England & Wales, said: “For many years, care providers were led to believe that the National Minimum Wage was not payable for the time spent asleep overnight by the relevant HMRC guidance at the time. However, a number of earlier Employment Tribunals and the Employment Appeal Tribunal have challenged this position and found that sleep-in shifts are working time and subject to the National Minimum Wage. If the Court of Appeal agrees, the financial viability of the sector will be at serious risk.”
The decision does not only affect private care providers, but also charities providing care services. Mencap alone has reported a liability of £20m and has said that it is at risk of insolvency if required to pay it.