03 May 2017
Treatment of "sleep-in" shifts for national minimum wage (NMW) purposes is an area that can often cause confusion.
Where a worker is required to work a number of "sleep-in" night shifts at the employer's premises, and be available in case of an emergency, does the full night shift constitute 'working' for the purposes of the NMW? Alternatively, is the worker only 'working' for NMW payment purposes when they are awake to carry out any relevant duties? The point is particularly significant in the care sector where sleep-in duties commonly arise.
In three combined appeals of Focus Care Agency Ltd v Roberts, Frudd v The Partington Group Ltd and Royal Mencap Society v Tomlinson-Blake the President of the Employment Appeal Tribunal (EAT) has considered the issues around 'sleep-in' shifts and answered:
"A multifactorial evaluation is required. No single factor is determinative and the relevance and weight of particular factors will vary with and depend on the context and circumstances of the particular case."
In other words the dreaded, "it depends on the facts of the case". On a positive note, the EAT has provided guidance on how a multifactorial evaluation is to be applied when considering whether the individual is "working" during the sleep-in period.
Why the confusion?
Under the NMW legislation, salaried hours workers and time work workers who are "on-call" are regarded as working when they are available at or near a place of work for the purpose of doing work and are required to be available for such work, unless they are at home. However, where a worker is entitled to sleep at or near a place of work when on call, and is provided with suitable facilities for sleeping, only time when the worker is awake for the purpose of working is treated as time work or salaried hours work - regulations 27 and 32 National Minimum Wage Regulations 2015.
Over recent years, tribunals have increasingly drawn an important distinction between those cases where an employee is "working" even when sleeping, merely by being present at the employer's premises and those where the employee is provided with sleeping accommodation and is simply on-call. A distinction not always easy to apply.
A multifactorial approach
The starting point is to determine whether the individual is "working" by being present at the workplace even in periods where they are permitted to sleep. It is only if the worker cannot be said to be "'working" that consideration of the "on-call" provisions of the NMW legislation comes into play.
Simply labelling a sleep-in shift as being "on-call" is not the answer. But where do you draw the line between cases where a worker is "working" throughout a sleep-in shift, being paid to be on the employer's premises "just in case", and those where a worker is "on call" and not deemed to be working the whole time? The EAT guidance is:
- Consider the employment contract together with the nature of the engagement and the work required to be carried out. Does the contract provide for the period in question to be part of the employee's working hours? Depending on the facts it may be relevant to consider whether the contract provides for pay to be calculated by reference to a shift or by reference to something else, and if so, to what; or to whether an identifiable period is specified during which work is to be done.
- The fact that an employee has little or nothing to do during certain hours does not mean that he or she is not working. A particular level of activity is not required. An individual can be working merely by being present even if they are simply required to deal with something untoward that might arise (for example a care worker treating a client who becomes unwell or distressed in the night), but are otherwise entitled to sleep and even where the likelihood and frequency of an untoward matter arising are low.
- No single factor is determinative and the weight each factor carries (if any) will vary according to the facts of the particular case. Potential relevant factors in determining whether a person is working by being present include:
- The employer's particular purpose in engaging the worker. For example, if the employer is subject to a regulatory or contractual requirement to have someone present during the particular period the worker is engaged to be present, that might indicate whether and the extent to which the worker is working by simply being present (In Esparon t/a Middle West Residential Care Home v Slavikoska 2014 the statutory duty on the employer to have a suitably qualified staff member present throughout the night pointed towards 'working').
- The extent to which the worker's activities are restricted by the requirement to be present and at the disposal of the employer. This may include considering the extent to which the worker is required to remain on the premises throughout the shift on pain of discipline if he or she slips away to do something else (In Whittlestone v BJP Home Support Ltd 2014 this pointed towards 'working').
- The degree of responsibility undertaken by the worker. A distinction can be made between the limited degree of responsibility in sleeping at the premises to call out the emergency services in case of a break-in or a fire on the one hand (point towards 'not working'), and a night sleeper in a care home where a heavier personal responsibility is placed on the worker in relation to duties that might have to be performed during the night (points towards 'working)
- The immediacy of the requirement to provide services if something untoward occurs or an emergency arises. In this regard, it may be relevant to determine whether the worker is the person who decides whether to intervene and then intervenes when necessary (points towards 'working'), or whether the worker is woken as and when needed by another worker with immediate responsibility for intervening (points towards 'not working').
Applying the guidance
Applying the above guidance to the three cases before it, the EAT held:
Royal Mencap Society v Tomlinson-Blake
The EAT held the tribunal was correct to find a care worker who provided care for two vulnerable adults with local authority assessed care plans specifying 24 hour support, was working for the entirety of her sleep-in shifts. The tribunal had correctly considered a number of factors including: the legal obligation on the employer to have someone at the premises under statute and under its contract with the local authority, the requirements that she remain at the premises throughout the shift and use her professional judgment to determine when intervention was needed in the night and if so she was required to respond appropriately and promptly.
Focus Care Agency Ltd v Roberts
In a case concerning a care worker, the EAT upheld the tribunal's finding that under the terms of the worker's contract he was entitled to his contractual pay for sleep-in shifts as he was for day and "waking night" shifts. In light of the contractual right, consideration of the NMW provisions was not required.
The EAT did however, state that had it not upheld the contractual right finding, the case would have had to have been remitted back to the tribunal to carry out a multifactorial evaluation. This case had the interesting feature that two night-shift workers were always allocated, one as a "waking night worker" and the other as “sleep-in night worker” role. The "waking night worker" was required to remain awake with the primary responsibility for the service user and paid at their contracted rate. The "sleep-in night worker" was employed to assist with any emergency that might arise but is not required to be awake and provided with facilities for sleeping. However, the contractual documentation did not make a distinction when it came to pay.
Frudd v The Partington Group Ltd
In a case concerning a receptionist/warden team who were employed and resided at the employer's caravan park, the tribunal found the two nights a week they were "on-call" out of hours did fall within the "on-call" provisions of the NMW legislation. The EAT has remitted the case to a fresh tribunal, as the original tribunal failed to take a multifactorial approach in particular the tribunal:
- failed to consider the purpose of the out of hours service and whether they were required to be present throughout the shift to fulfil an obligation of the employer to provide services to its customers on a 24/7 basis; and
- the extent of the responsibilities during the sleep-in shift were not considered.
Lessons for employers
While each case will be fact sensitive, and no single factor will be determinative on its own, this latest EAT judgment is in line with the increasing trend for tribunals to find workers will be 'working' the entire sleep-in shift even when sleeping where:
- the employer is under a statutory or contractual duty to have a worker on the premises at all times;
- the worker is unable to leave the premises at any time during the shift; and/or
- the worker has a degree of responsibility for personally performing duties when needed and making judgments about what is required over and above merely having to call out emergency services.
It is also important for employers to get their contractual documentation right, the final outcome in Focus Care Agency Ltd v Roberts may have been different had the contractual documentation been different.
Employers need to consider carefully their pay practices for "sleep-in shifts" as getting it wrong has potential civil and criminal penalties as well significant PR implications. Employers who get it wrong face possible:
- Unlawful deduction of wages and/or breach of contract claims by individual workers, potentially going back two years.
- HMRC enforcement notices and financial penalties of up to £20,000 per employee.
- Possible criminal sanction for the most serious cases.
If in doubt, seek professional advice.
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