Three recent decisions have redefined our understanding of ‘work’ under the National Minimum Wage (NMW) Regulations 2015, ‘working time’ under the Working Time Regulations 1998 (WTR) and whether domestic workers are entitled to the NMW. Affected employers should consider whether changes to contractual terms and/or working practices are now necessary and take advice accordingly.
Workers are entitled to be paid if they are required to be available for work at or near the workplace. Are workers therefore entitled to the NMW for hours when they sleep at their workplace? The Supreme Court has recently held that the definition of ‘time work’ under the NMW Regulations meant time that the worker was required to be awake for the purpose of working. Thus for workers who are obliged to spend the night at or near their workplace, but permitted to sleep unless actually required for work, the entire shift would not automatically qualify as ‘time work’. Instead, ‘time work’ would consist only of any discrete periods of time that they are awake and working during the shift. If these discrete periods have been so frequent or lengthy that they have had very interrupted sleep, only then would the entire shift count as ‘time work’. The requirement to keep a ‘listening ear’ out for disturbances was not considered ‘time work’.
While this judgment concerned sleep-in workers, it is likely that on-call night workers who are permitted to sleep at their own homes will also become unable to claim that they are performing ‘time work’.
This is in theory good news for employers, but there is an administrative burden, as the time that employees actually work during a ‘sleep-in’ shift will need to be tracked. Employers should also decide the appropriate threshold of work that would ‘very significantly affect’ the workers’ sleeping time (thus rendering the entire shift as ‘time work’). Will the administrative burden mean that it is more cost-effective simply to pay the NMW, but no more, for the entire shift: and if they do so, or if they elect to pay only for time actually worked, will this lead to recruitment difficulties if their competitors take a more worker-friendly approach?
On-call workers may be required to carry out work while on-call, but only if they are asked to do so: otherwise they are on stand-by. The Court of Justice of the European Union (ECJ) has considered whether time on stand-by is working time for the purposes of the Working Time Directive: this has a knock on effect to the workers’ entitlements including rest periods and annual leave. The ECJ ruled that stand-by time is not to be considered ‘working time’ unless the constraints imposed on the worker very significantly affect their ability to manage their free time during that period. Constraints may be imposed by the employer, a collective agreement or national law; but factors such as a workplace in a remote location, or free-choice factors such as where the employee chooses to live, are not valid ‘constraints’.
UK courts and tribunals may still ‘have regard’ to decisions of the ECJ, notwithstanding Brexit, so UK law may well follow this decision and it is therefore relevant to UK employers. Employers with ‘on-call’ staff duties should consider whether the workers’ ability to manage their free-time during stand-by is being ‘very significantly affected’. If so, the entire on-call shift would be considered ‘working time’ and therefore employers should consider whether they are properly complying with the WTR with regards to working hours, rest periods, annual leave and remuneration.
Domestic workers, such as au pairs, have not been entitled to the NMW due to an exemption in the NMW Regulations, which applies if they reside in the family home, are treated like a member of the family and do not pay for accommodation or food. An employment tribunal has found this exemption to be indirectly discriminatory towards women, in light of compelling evidence that females overwhelmingly occupy these positions, meaning that the NMW would apply.
Although other courts are not bound by this decision, it is potentially of huge significance given the hours which an au pair might be required to work (taking into account the points above on ‘on-call’ working and ‘sleep-in’ roles). Employers of au pairs should consider defining working time requirements carefully, and observe any limits on that time, to reduce their exposure to NMW claims.
In some circumstances, workers will be engaged to carry out duties for the same employer, but under separate contracts. The ECJ has now made the common-sense determination that the minimum daily period of rest, of 11 consecutive hours, provided for by the Working Time Directive applies cumulatively to the work done under those contracts rather than to each contract separately.