A HMRC investigation into illegal low pay in the care sector, which breaches National Minimum Wage (NMW) legislation, has resulted in thousands of workers receiving back pay.
At least 130 care providers have been subject to HMRC scrutiny during the past 12 months and fines totalling £122,249 have so far been handed down, after it was proved that some had broken employment laws.
Many of the breaches were due to care workers not receiving any payment for time spent travelling between each client. Other care companies were found to have broken the law by paying their staff less than the NMW for the hours spent providing live-in care.
Dave Prentis, general secretary of Unison, said. “No one would expect a paramedic to be paid only when they’re saving patients’ lives or a firefighter just for when they’re putting out fires and home care workers shouldn’t be treated any differently. Yet sadly they are.”
Norman Lamb, the former Liberal Democrat care minister claimed the situation was endemic in the care industry.
“Councils are complicit,” he said. “They commission domiciliary care but the amount they are prepared to pay often does not recognise the travel distances involved.”
The largest legal case to date, involving the non-payment of NMW within the care sector, has been brought by Unison. A group of 17 care workers claim they were paid the equivalent of £3.27 an hour, less than half the minimum wage, working for care contractor, Sevacare, in London. The company has disputed the allegations, claiming that it was paying an hourly rate which complied with NMW and the case is still to be concluded.
Lara Murray, an employment law expert with Palmers, said: “With HMRC conducting wide scale investigations into illegal low pay and a significant legal case for non-payment of NMW currently being considered by the courts, it is important that all employers, regardless of industry sector, check that they are complying with the terms of NMW legislation.
“A worker’s basic pay rate might initially appear to comply with NMW tariffs. However, travel obligations between jobs or additional time spent on-site complying with security checks – as with Sports Direct’s warehouse workers – must all be factored in.”
For advice and support on NMW compliance and all aspects of employment law affecting employers, please contact us.