The Court of Appeal handed down its much anticipated judgment on Friday last week in the joined cases of Royal Mencap v Thompson Blake and John Shannon v Jakishan and Prithee Rampersad (t/a Clifton House Residential Home). The decision provides much-needed clarity on whether workers are entitled to the national minimum wage for each hour during “sleepover shifts”.
Previous case law stated that this determination could only be made by applying a “multifactorial” approach which, in the words of Lord Justice Underhill, was “hard to understand” and created much uncertainty for employers (particularly within the hard-pressed care sector which it was estimated would be required to cough up an eye-watering £400million in back pay should each hour of a sleepover shift count as working time for NMW purposes).
One of the more complicated aspects of the NMW Regulations 2015 is the differentiation made between “types” of worker which impacts the assessment of what amounts to working time for NMW purposes. The Mencap judgment is particularly useful as it deals with the position on sleepover shifts for both time workers and salaried workers (this was necessary since the workers in the case were said to be time workers whereas the workers in Shannon were said to be salaried). The judgment also deals obiter with the position in respect of unmeasured workers.
Actual work vs availability for work
In coming to its decision, the Court noted the similarity between the provisions of the 2015 National Minimum Wage Regulations for time workers and salaried workers in this area (Regulations 32 and 27 respectively). In line with the legislation, it drew a distinction between “actual work” and “availability for work”. In “availability for work” cases, the Court noted the “sleep-in exception” provided for in the same terms at Regulations 27 (2) and 32(2) which states “hours when a worker is available only includes hours when the worker is awake for the purposes of working, even if a worker by arrangement sleeps at or near a place of work and the employer provides suitable facilities for sleeping”.
In his judgment, Lord Justice Underhill concluded that sleepers-in (where a worker is contractually obliged to spend the night at or near their workplace on the basis that they are expected to sleep for all or most of the period but may be woken if required to undertake some specific activity) are to be characterised as “available for work” rather than actually working and so fall within the sleep-in exception above. He noted that “the result is that the only time that counts for NMW purposes is time when the worker is required to be awake for the purposes of working”.
The importance of the decision cannot be undersold as it means that a number of previous cases on this point (Esparon v Slavikovska , Whittlestone v BJP Support  and Burrow Down Support Services Ltd v Rossiter ) have all been wrongly decided. Lord Underhill did not hold back in criticising previous decisions made on the point, pointing out the “basic artificiality of describing someone as working – still more, as actually working – during a shift when it is positively expected that they will spend substantially the whole time asleep”.
Expectation of sleep vs permitted to sleep
It is clear from Mencap that the fundamental feature of a sleep-in arrangement is the expectation that the worker will sleep for the shift, unless woken for work (at which point the clock would start ticking for NMW working time purposes). This is essential as it allowed the case to be distinguished from the leading Court of Appeal case of British Nursing Association v Inland Revenue in 2002. This found that nursing staff were at work (rather than available for work) throughout the entirety of their shift when delivering an emergency-bank-nurse booking service whilst at home.
In determining that the nurses were “working” throughout the period, the key factors were that (i) the nurses were performing the same work as those nurses on day shifts; and (ii) whilst the nurses were permitted to sleep during periods of slack time, it was not the expectation that they would do so. Lord Justice Underhill noted about the case: “the decision certainly establishes that the fact a worker is entitled to go to sleep in the intervals between particular tasks is not necessarily inconsistent with them actually working during the entirety of the period”.
As set out above, going forwards, the key question for employers when dealing with workers who may sleep during their shift, is whether the workers are either (a) working or (b) available for work. Key to this assessment is whether the worker is expected or permitted to sleep. Where a worker is expected to sleep, this clearly falls within the sleep-in arrangement in Mencap meaning pay is only due for NMW purposes during periods where the worker is awake in order to work. Where workers have specific tasks to fulfil but are otherwise permitted to sleep, this falls more clearly within the British Nursing Association rule, meaning the workers are working throughout the shift for NMW purposes.
Employers should try to make the position clear in staff contracts of employment, probably by reference to when the work being done on the shift arises. If you arrive to a certain set of tasks but are permitted a nap when they are completed, that is a different situation from arriving with little or nothing specific to be done but having to wake up to deal with anything new which arises mid-sleep.
In contrast to the position for time workers and salaried workers, the Court noted that the Regulations concerning unmeasured workers do not contain “availability to work” provisions.
Nevertheless, many care providers have taken advantage of this type of working arrangement as it allows an agreement to be reached as to the average daily number of hours that a worker is likely to spend carrying out duties required under the contract. Provided the average agreed is realistic, it will apply for NMW purposes even if the actual number is slightly different.
Employers which operate daily average agreements will be pleased that the Court’s ruling here does not affect that arrangement, as it can be a useful way of providing certainty for both parties as to the pay due to a worker.
Whether this decision is appealed by the individuals involved is yet to be seen. However we hope (for clarity’s sake) that it is not.