Change in HMRC Stance Regarding Sleep-ins

Regular followers will recall my previous blog on the sleep-in position and the work of HM Revenue & Customs’ (HMRC) Minimum Wage Enforcement Team, who have been working their way around homecare agencies looking for examples where sleep-ins have not been properly paid.  

You may have seen recently that HMRC have suspended these investigations until 2 October 2017.  They have also confirmed they will waive historic financial penalties owed by employers who have underpaid their workers for sleep-ins prior to 26 July 2017.  

It appears that a sustained campaign by the social care sector has made HMRC review their position.  However, it is only the historic financial penalties that have been waived.  Workers will still be entitled to historic arrears of pay and there are, therefore, still many unresolved issues.

Many of you will recall that the confusion over what is a legal requirement to ensure that workers are being paid the appropriate wage for sleep-ins has been ongoing for some time.

The recent case of Tomlinson-Blake -v- Royal Mencap Society pretty much settled the matter. Prior to the case, HMRC were clear in their view that it was any time spent whilst workers were awake that counted towards the National Minimum Wage.  That approach has now changed and many employers in the sector therefore have a significant backlog of potential wage payments.

There is an exceptionally informative briefing issued by Anthony Collins Solicitors LLP who are the preferred solicitors for UKHCA and would be a useful read for anybody in the sector.

Colin Peacock