The complexities of applying the National Minimum Wage to night workers who sleep at their employer's premises may be something of a nightmare for employers; but Mike Smith reports on a recent EAT decision which provides helpful guidance on this issue.

The background

Since 1999, most workers have been entitled to be paid the National Minimum Wage (NMW) - currently £6.31 for adults and set to increase to £6.50 from 1 October 2014.
This is straightforward for workers who undertake conventional day time working, but becomes more complex when the line between 'work' and leisure time is blurred – for example, where workers are 'on call' but must be available for work or are night workers who may be asleep for much of their shift.

The NMW Regulations set out that they apply where a worker is

  • available at or near a place of work
  • for the purpose of doing 'time work' and
  • is required to be available for such work.

However, for workers who sleep at or near work, and are provided with suitable facilities for sleeping, time during the hours they are allowed to use those facilities for the purposes of sleeping will only count as 'time work' where the worker is awake for the purpose of working (regulation 15(1)(A), NMW Regulations).

A worker who does not receive the NMW has two potential routes to a claim.

  1. An unlawful deduction from wages claim, brought in an employment tribunal. There is no limit on the length of arrears that can be claimed, provided it is all part of the same series of unlawful deductions.
  2. A breach of contract claim, either in the employment tribunal or the county court. Arrears can be claimed going back up to six years.

There is a body of case law which has developed around the determining when a night worker is, or is not, entitled to be paid the NMW when sleeping at, or near, work – and cases which appear to have very similar facts can produce very different results. 

The Employment Appeal Tribunal has, this month, reviewed the relevant authorities and considered the tricky question of payment whilst sleeping in the case of Esparon t/a Middle West Residential Care Home v Slavikovska.

The facts

The Claimant, Miss Slavikovska, was employed by Middle West Residential Care Home ('Middle West') as a care worker at Middle West's residential care home. She was required to work a number of ‘sleep-in’ night shifts and be available for emergency purposes.  Regulations required Middle West to ensure that at all times suitably qualified, competent and experienced persons were working at the care home, in order to protect the health and welfare of service users.

It was found that Miss Slavikovska was required to carry out certain duties during her night shift and she received a lump sum payment for doing so; but this was much less than the hourly NMW rate. Miss Slavikovska argued that she was carrying out 'time work' (as defined above) because

  • (a) she was required to work during her 'sleep-in' shift; and
  • (b) she was entitled to be paid simply for being present at Middle West's premises.

An employment tribunal found in favour of Miss Slavikovska on both grounds and Middle West appealed. 

The decision

The Employment Appeal Tribunal (EAT) upheld the employment tribunal's decision on both grounds. The EAT took the opportunity to review the authorities in relation to 'night sleepers' and noted that it is very difficult to distinguish between

  • 'at work' cases where the employee is paid to be present at work 'just in case'; and
  • 'on call' cases where the employee is required to be there on call and not deemed to be working the whole time.

The EAT's approach was to suggest that an important consideration must be why [our emphasis] the employer requires the employee to be on the premises.  If the employer requires the worker to be present on work premises pursuant to a statutory requirement to have a suitable person on the premises 'just in case', that would be, the EAT said, "a powerful indicator" that the employee is being paid simply to be there and is, therefore, deemed to be working - regardless of whether or not work is actually carried out.

In its judgment, the EAT also noted with approval the recent case of Whittlestone v BJP Home Support, in which a 'night sleeper' was held to be undertaking 'time work' because, although she could sleep while at work, she would have been disciplined if she had left her employer's premises. 

What does this mean for me?

If you require employees or workers to be present at work over night, particularly if this is to meet regulatory requirements, then it is very likely that this time should be included for the purposes of calculating hourly NMW rates. It seems that the key factor is the requirement for the employee / worker to be present at work, regardless of whether or not work is undertaken.

That said, this type of case will always be very fact dependent, so the EAT's guidance should be applied with caution. A contrasting example is the 2011 case of Manchester Abbeyfield Society v Hopkins, in which workers at a residential home were provided with accommodation at the home and required to be on call during the working week – in those circumstances, the workers in question were only entitled to the NMW when they were awake for the purposes of working.

As the EAT itself noted, the caselaw in this area is difficult to reconcile. But it seems that the nub of the question is whether employees are

  • sleeping, either at, or near, work and 'on call' - during which time they will only be paid for work undertaken while awake
  • sleeping at work because they are required to be present at work – during which time they will be working for the purpose of NMW calculations.

Finally, note that, because NMW wages claims in the employment tribunal can be back-dated indefinitely, even small hourly underpayments may prove costly (Miss Slavikovska claimed around £30,000).