30 October 2017

Case law: Court clarifies relevant factors when assessing whether sleep-in staff should be paid living/national minimum wage

Employers will welcome clarification of the multiple factors to take into account when deciding when a sleep-in employee is entitled to the living or national minimum wage for the time they are asleep/not working.

A sleep-in assistant employed by a charity providing accommodation to over-55s was allowed to do nothing and/or sleep during her night shift, and only had to carry out active duties in an emergency.

She was paid the national minimum wage for times she was active, but otherwise received only a lump sum. If the lump sum was divided by the number of hours she worked, the resulting hourly rate was less than the minimum wage.

The Employment Tribunal (ET) ruled that the fact she was required by her terms of employment to be on the premises was a 'powerful indicator' that all her hours were 'time work' within the meaning of the relevant regulations, so she should be paid the minimum wage simply for being there. It awarded her more than £24,000 in back pay.

On appeal, the Employment Appeal Tribunal (EAT) said that the starting point, when considering whether she was contractually obliged to be at the premises, was whether her terms of employment required her to be. The ET should have taken a multifactorial approach, taking into account factors flagged in previous rulings on similar facts. The EAT said, however, that no single factor is determinative - and any weight each factor carries will vary on the facts of the case. The factors include:

  • Whether the employee is working during the period they claim. Work is determined on a realistic appraisal of the circumstances, in the light of the employee's terms of employment and the context within which it was entered into, including the nature of the engagement and the work required to be carried out.
  • Whether the contract, as a matter of construction, provides for the period to be part of the employee's working hours, given the factual matrix and any supplemental relevant and admissible material.
  • Whether the contract provides for pay to be calculated by reference to a shift or by reference to something else, and if so, to what; or whether an identifiable period is specified during which work is to be done.

The EAT found that the fact an employee has nothing to do during certain hours does not mean they are not working. An employee can be working merely by being present even if they are, for all or part of the time, asleep (even when they have not had to wake up at all). Potentially relevant factors (whose weight varies according to the circumstances) are:

  • The employer's particular purpose in engaging the worker, if it 'informs what the worker might be expected or required to do' (for example, if there is a 'regulatory or contractual requirement to have someone present during the particular period … [this] might indicate whether and the extent to which the worker is working by simply being present'.
  • The extent to which the worker's activities are restricted by the requirement to be present and at the employer's disposal. For instance, whether the worker must stay on the premises on pain of being disciplined if they slip away to do something else.
  • The degree of responsibility undertaken by the worker.
  • The immediacy of the requirement to provide services if something untoward occurs, or an emergency arises, for example, whether the worker decides whether to intervene (and does so), or is woken as needed by another worker with immediate responsibility for intervening.

Operative date

  • Now

Recommendation

  • Employers should ensure they take account of the multiple relevant factors that affect whether a sleep-in employee is entitled to the living or national minimum wage for the time they are asleep/not working

Case ref: Abbeyfield Wessex Society Ltd v Edwards UKEAT/0256/16/BA