We know that many care workers get a bad deal with regards to their pay and hours of work. Our main guide on the working rights of care workers gives comprehensive advice about rights to pay (National Minimum Wage legislation), rest breaks and hours of work (Working Time Regulations legislation).

The National Minimum Wage legislation is certainly not straightforward and sometimes it can be difficult to establish what hours you should be paid for and there are, unfortunately, employers who look to exploit this.

There are, of course, good care sector employers out there but we hear about many rogue employers. With only one in four unqualified care workers a member of a trade union, there is less organisation in getting carer’s employment rights enforced. With the introduction of Employment Tribunal fees last year, this may mean an individual cannot afford to take a Tribunal case against an employer who is clearly breaking the law.

It is well known that the care workforce is badly paid, with 9% of staff earning less than the minimum wage (2011 statistics). A report by The Resolution Foundation in in August 2013 called “Does it pay to Care? Under-payment of the National Minimum Wage in the social care sector” also found this to be the case.

The Report said that:

  • While care workers “headline” pay rates were set at or above the NMW, many lost at least £1 per hour because they were not paid for the time spent travelling between appointments, and also because providing decent care often takes longer than the time allocated by the employer to each visit
  • There are an estimated 2 million care workers in the UK, of which 830,000 are domiciliary care workers that carry out home visits. It is estimated that up to 220,000 of all care workers might be paid less than the minimum wage. Pay in the sector is already among the lowest in the UK, with the median hourly wage only 15% above the NMW.
  • The report questioned how, despite the law being reasonably clear in regards to travel time, many independent care providers are able to operate pay systems that see care workers paid less than the National Minimum Wage without facing adverse consequences.

Now, the Government is aware of these problems and is proposing tougher sanctions for those employers in the care sector who don’t pay the National Minimum Wage in the future. These include employers facing:

  • An obligation to pay arrears of pay to workers
  • A penalty of up to £20,000 in relation to each underpaid worker (currently the financial penalty is 100% of the total underpayment of NMW up to a maximum of £20,000 in total; not per worker)
  • Criminal proceedings and an unlimited fine against the company as well as against the officers of the company (the current criminal penalty is a fine of up to £5,000)
  • Public naming and shaming in the news media (this is already happening)
  • And importantly, exclusion from tendering for local authority care and support services contracts (in draft guidance to the Care Act 2014, published in June, the Government stated that “when commissioning care contracts, local authorities should assure themselves and have evidence that service providers deliver services through staff who are remunerated so as to retain an effective workforce. Remuneration should be at least sufficient to comply with the NMW legislation… including remuneration for any time spent travelling between appointments”)

Currently HMRC enforces the NMW and enforcement can be initiated either by a complaint from a worker or a third party or as a result of targeted enforcement of a particularly low-paying sector. HMRC can carry out workplace inspections at any time without reason.

Underpaying employers are given a ‘notice of underpayment’ which sets out the arrears of NMW to be paid and the financial penalty they need to pay to the Government. An employer can be sued if they ignore this notice and also be prosecuted as it is a criminal offence to refuse or neglect to pay the NMW, or not keep the required records.

The Government operates a Pay and Work Rights Helpline which can advise you about the NMW – on 0800 917 2368 – and you can report NMW abuses to them on this number.

If you are an Employer and need ongoing professional help with any staff/freelance issues, or a Contractor/Freelancer/Employee with a complicated employment related problem, then talk to Lesley at The HR Kiosk  – a Human Resources Consultancy for small businesses – our fees are low to reflect the pressures on small businesses and you can hire us for as much time as you need.

Please note that the advice given on this website and by our Advisors is guidance only and cannot be taken as an authoritative or current interpretation of the law. It can also not be seen as specific advice for individual cases. Please also note that there are differences in legislation in Northern Ireland.

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