Kingston Smith

Court of Appeal rules for employer in key case of ‘sleep-in’ workers

Summary

The Court of Appeal has ruled that employers do not have to pay workers the national minimum wage for the whole time spent on an employer’s premises under ‘sleep-in’ arrangements.

In this case, involving Mencap, carers were obliged to spend the night at or near their employer’s premises.  The specific arrangement was that the carers were expected to sleep for all or most of the period but may be woken if required to undertake some specific activity.

Outcome

The Court of Appeal said that this type of arrangement fell within an exception to the national minimum wage. This is where workers do not have to be paid national minimum wage when they are available to work but not actually working.  Within the context of sleep in arrangements, this means the worker is only paid if they are awake and needed for work.

Appeal

While the decision removes uncertainty around this issue, it has attracted criticism from trade unions.  The union representing the workers is now considering an appeal to the Supreme Court.

If an appeal happens, the Supreme Court could either:

  1. Allow the appeal, meaning employers will need to continue paying national minimum wage for all time spent on the employer’s premises; or
  2. Reject the appeal, meaning employers can reduce the payments they make in line with the judgment.

Whatever the Supreme Court decides will be the settled legal position, with no further possibility of appeal.

Our recommendation

We therefore recommend that employers do not make changes to payments to workers straight away.

Instead they should continue to pay workers for all time spent on site for the time being until either the outcome of any appeal or the employees decide not to appeal.

The Employees have until 10 August 2018 to apply to the Court of Appeal for permission to appeal to the Supreme Court.  If the application is refused, the employees have 28 days from the refusal to apply for permission directly to the Supreme Court.

We will re-blog this topic again once we know whether or not there will be an appeal.

The national minimum wage appears simple, but it is an extremely complex piece of legislation.  If you need any assistance with complying with the rules, please contact Kingston Smith HR Consultancy, where a consultant will be pleased to assist you.