[UK] UK social care providers given 15 months to cough up pay arrears for sleep-in workers

But critics warn the estimated £400 million bill could lead to some organisations becoming insolvent.

UK social care providers have been given 15 months to pay sleep-in care workers up to six years’ worth of wage arrears estimated to total £400 million (US$525 million).

According to Third Sector magazine, the government has told organisations they have a year to identify how much they owe and has asked them to volunteer this information to Her Majesty’s Revenue & Customs (HMRC). They will then be provided with a further three months to pay the arrears.

Sleep-in care workers, who are widely used in the social care sector to supervise vulnerable adults, have traditionally been paid a flat rate of between £34 and £45 (US$46 and US$59) per hour when asleep and either the national minimum (NMW)) or living wage when looking after them.

But following two employment tribunal decisions last year, the Department for Business, Energy & Industrial Strategy changed its guidance to ensure that the NMW covered sleep-in carers for the entirety of the time they were working.

Under the new Social Care Compliance Scheme, will start writing to social care employers with complaints against them for underpaying staff to encourage them to take action. Employers that chose not to will be “subject to HMRC’s normal enforcement approach”, the government said.

But Emma Burrows, a partner at law firm Trowers & Hamlins, warned that the move could lead to some providers becoming insolvent as the government had not indicated that any financial help would be forthcoming.

“It is likely that this liability will lead to social care providers considering giving some services back to commissioners, possibly facing insolvency issues and certainly being more risk-averse in strategic decisions about the care they provide in future,” she said.