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Government sleepwalked into sleep-in crisis

    Yesterday MENCAP announced that they may have to withdraw from providing support for more than 2000 adults with learning disabilities unless the row over back pay is settled. 

    The debate around funding the future of social care often focuses on older adults and their associated medical needs, especially when we face a growing ageing population, but a large chunk of the social care spend – estimated at £8bn by the National Audit Office - goes on supporting adults with learning disabilities to live independently. This could be in the form of 24-hour care with large staff team in their own homes or it could be several hours a day with shared support at night for adults living in shared accommodation or flats. Either way, this support usually includes a night time element and this is where MENCAP - and many other smaller providers - are having a problem.

    Previously, a staff member doing a "sleep-in" - a shift usually from 10pm to between 7 and 9am where you are on site in case of an emergency but have no allocated tasks and are asleep for most of the time - would be paid a flat rate on the basis that they weren’t actually awake working. It should be noted here that if anything did happen during the night and the staff member did get up to deal with it, they are paid their hourly rate for the time they are awake. But in 2015 a number of support workers challenged their employers in employment tribunals over the rate of pay for sleep-ins. The tribunals ruled that support workers should be at least paid the hourly minimum wage for these shifts, with up to 6 years back pay. The government then clarified the law to say sleep-ins should be paid at least the national minimum wage – as recently as 2015 government guidance on sleep in pay did not make clear they expected this to be paid at minimum wage rates. This meant social care providers found themselves facing a significant and unexpected bill, estimated to be around £400million. Providers had charged the clients – either directly or through local authority contracts - a flat rate for the sleep-ins provided so the 6 years of back pay would be coming entirely from the pockets of the providers. MENCAP have taken a lead within the sector and started a campaign, #StopSleepInCrisis, asking the government to foot the back-pay bill. MENCAP argue they were following the letter of Minimum Wage Regulations in paying a flat rate for sleep-ins until April 2017 (HMRC guidance was only updated in 2016) and that the tribunal’s ruling on back pay will cripple many providers if they have to pay themselves.

    In July, following announcements from a number of providers that they would face bankruptcy if they had to cover the back pay, the government announced a two-month suspension of the HMRC enforcement, but now that the deadline is approaching at the beginning of October it is worrying that the government still hasn’t made clear what support, if any, the organisations and charities will receive to help cover the bill.

    The back pay isn’t the only issue though. The other less well-known knock on effect of this judgement is that there is a growing need for more staff. Previously, employers were able to rota staff on to a full shift on day 1 – say 2-10pm – and then a sleep in, followed by another waking shift and the staff member leaves work mid-afternoon on day 2. Some employees preferred this way of organising their hours. It’s a good way to get a chunk of your contracted hours worked in one go meaning you can have more consecutive time off. However, as a result of the increased wage costs for sleep ins, many providers are switching to a waking night – where the staff member is awake and has allocated tasks during the night such as updating files, cleaning the home, etc. Planned increases to the minimum wage in the coming years will only add more pressure to an industry where the majority of employees are lower paid and recruitment is difficult. The logic of the old flat rate system makes sense: if employers have to pay staff the same rate to be asleep doing nothing as being awake for 9-11 hours they’re going to have staff up and working. This does mean that staff cannot be scheduled on back to back shifts, resulting in a need for even more staff in a sector that struggles to recruit enough trained staff as it is.

    This whole situation comes about as a result of the government’s well-meaning meddling with wage legislation. The changes to pay rates for sleep-ins have led to less flexibility for employees, a massive and unexpected bill for employers, and unnecessary distress and anxiety for clients who rely on overnight care. While people agree we would like people to be paid fair wages for the work they do, a flat rate for time spent at work but not actively working seems reasonable but minimum wage legislation does not make allowances for different types of work and the lack of clarity from the government allowed the situation to continue for years.

    The chaos and confusion of the sleep-in situation in social care should be a cautionary tale for the Labour Party and their plans to ban zero hours contracts. Yes, there are abuses. I was surprised to discover MENCAP’s flat rate for sleep-ins was only £29 – the social care provider I previously worked for paid £40 – but employees and employers both value flexibility. 70% of people on a zero hours contract are happy with the number of hours they work and don’t want additional hours. The Taylor review highlighted the importance of trade-offs and of work-life balance. If staff would prefer the flexibility of combining waking shifts and sleep-ins only made possible by the lower rate of pay that should be given serious consideration. 

    The government needs to be more aware of the unintended consequences of its increasingly regular interventions into the labour market. Perhaps being forced to foot a £400million bill for back pay might just to the job.

    Emma Revell

    Emma joined the Centre for Policy Studies in January 2017 and is responsible for promoting our publications and events. Prior to joining the CPS, Emma worked as a Development Officer with a not-for-profit social care organisation.

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