National Minimum Wage: Care Sector

Liz McInnes Excerpts

Wednesday 23rd March 2016 Westminster Hall

[Liz McInnes (Heywood and Middleton) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Rosindell. I thank my hon. Friend the Member for Sheffield Central (Paul Blomfield) for obtaining the debate. I will try to be brief.

The Labour party recognised the issue with the social care system prior to the last general election. In our 2015 manifesto we promised to end 15-minute visits and introduce year of care budgets, to incentivise better care in the home. We promised to recruit 5,000 new home care workers—an entirely new arm of the NHS—to help to care for those with the greatest needs at home. We promised to tackle workforce exploitation in the care sector, and to ban the use of zero-hours contracts where regular hours were being worked, improving the working lives of carers. However, that was not to be.

Figures show that up to 220,000 home care workers are illegally paid less than the minimum wage. Investigations by HMRC between 2011 and 2015 found that 41% of care providers were guilty of non-compliance. As has been mentioned, the Resolution Foundation has calculated that care workers are collectively cheated of £130 million a year.

--- Later in debate ---

On resuming—

[Liz McInnes]

One major way in which care workers are denied the national minimum wage, which has been referred to throughout this debate, is for the care providers to refuse to pay for travel time between calls. I had never heard of the practice, which my hon. Friend the Member for Sheffield Central described, of care workers being paid a miserly 12p per hour for travel time. That, to me, sounds more like a cycling rate.

The law states that workers must be paid at least the national minimum wage for travel that is a part of their work and not incidental to it. If someone’s work consists of assignments carried out at different places between which they are obliged to travel, the time they take to do so is regarded in law as work time and must be paid accordingly. The National Institute for Health and Care Excellence stated that care providers should ensure that workers have time to do their job without being rushed and without compromising the dignity and wellbeing of the person who uses the services. Not paying for travel time makes that impossible.

The BBC recently reported on a group of home care workers who are Unison members, who are owed up to £2,500 each as a consequence of being paid less than the national minimum wage—again, because they were not paid for travel time. In a recent case, which was settled out of court, a worker was paid £1,250 in compensation for non-payment of travel time.

Furthermore, in summer 2015, HMRC launched a new national minimum wage campaign, which allows employers who have not been paying their workers the national minimum wage to escape punishment. Employers who are guilty of non-compliance can now just notify HMRC of their transgression, declare that they have paid their workers any money owed, and agree to obey the law in future.

That all contradicts the Prime Minister’s August 2015 claim that

“the message is clear: underpay your staff, and you will pay the price.”

Such employers are not paying the price. We need a major change in policy if the Government are serious about stamping out that deep-rooted practice and protecting the legal rights of home care workers. The Government should make regulations, as provided for under section 12 of the National Minimum Wage Act 1998, requiring employers to provide their workers with a statement demonstrating compliance with the national minimum wage. The exploitation of care workers must stop; we must ensure that they get the pay to which they are entitled.