Employers in the social care sector have had mixed messages from HMRC as to whether National Minimum Wage (NMW) should be paid to workers carrying out sleep-in shifts. It has now been made clear that NMW does apply in such cases.
A new HMRC scheme, the Social Care Compliance Scheme (SCCS), has been in effect from 1 November 2017. Employers come under the scheme on an opt-in basis – ‘at HMRC’s discretion’. They can use SCCS to ‘self review’, identify and pay any arrears for sleep-in shifts. Under the scheme, a period of 12 months has been allowed for self-review, with a further three months to pay arrears.
The deadline to join SCCS is 31 December 2018. The scheme will end on 31 March 2019, which is also the final deadline for paying all arrears.
The benefit of the scheme to employers who opt in is that they will not then be liable for penalties. Current penalties for non-payment of NMW are 200% of the amount owed, up to a maximum of £20,000 per worker.
Employers who don’t opt in will be subject to normal enforcement procedures, and be unable to access these concessions. They could then be liable to penalties, potential prosecution, and risk being named and shamed for NMW underpayment. Employers will not be charged a penalty for NMW arrears accrued before 26 July 2017.
For information of users: This material is published for the information of clients. It provides only an overview of the regulations in force at the date of publication, and no action should be taken without consulting the detailed legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material can be accepted by the authors or the firm.