Tens of thousands of care workers 'still paid below minimum wage despite new regulations'

Unison calls for health regulator to be given power to inspect how local authorities commission care

Tens of thousands of care workers are still being paid below the national minimum wage despite new regulation designed to ensure they are paid fairly, a new study says.

Despite a change in the law and a major HMRC investigation, care firms are still failing to pay staff for travel between clients according to the research from Unison, based on Freedom of Information responses from more than 150 councils in England and Wales.

It found that more than 75 per cent of councils in England and 90 per cent of councils in Wales are failing to ensure that care providers pay their employees correctly.

The care industry, which employs about 1.4 million people in UK, has long been associated with low pay and is facing dual pressures from funding cuts and an ageing population.

Unison general secretary David Prentis, said: “It’s a scandal that more than 200,000 care workers are receiving illegal wages of less than £6.70… Councils shouldn’t be awarding contracts to firms without ensuring they’re prepared to pay travel time.” 

Unison said the figures showed a modest improvement on last year, but the failure to pay for travel time remains “endemic” despite the new provisions of the Care Act. Mr Prentis added: “The law makes it absolutely clear that staff must be paid for any time spent travelling to and from the homes of the people they care for.” 

The best care home in London

The union is now is calling for the health regulator, the Quality Care Commission, to be given power to inspect how local authorities commission care. It is also calling for greater transparency for  local authority pay rates, as well as spot inspections of providers’ payroll records. The UK Homecare Association estimates that workers spend 20 per cent of their working day travelling.

Barbara Keeley MP, Labour’s Shadow Minister for Older People, Social Care and Carers, said: "Care staff do an incredibly important job looking after family members when they are at their most vulnerable. 

“Yet, as Unison has shown, thousands are not even being paid the minimum wage. This is bad for staff and it impacts on people who are receiving care.

“Rather than standing by and doing nothing, this Tory Government needs to act and ensure that social care is properly funded and that staff are properly paid.”

HMRC is currently investigating 100 firms over their failure to pay staff the national minimum wage, which the Resolution Foundation think-tank estimates costs care workers £130m a year in lost wages. HMRC says it has acted against 557 firms since April last year and clawed back more than £8m of wages for workers.

Laura Gardiner, of the Resolution Foundation, said: “It’s a complex situation and it’s possible for firms to purposely or accidentally fail to pay the minimum wage, but the law is the law and there is no excuse.

“The bottom line is that care providers should not accept a contract from a local authority if they think it is going to force them to behave illegally.”

A Department of Health spokesperson said: “Non-compliance with national minimum wage is illegal and unacceptable and the Department of Health is working with HMRC to help stamp it out in the home care sector. The Care Act directs local authorities to ensure that care workers must be paid at least the minimum wage.

“We are working with local authorities and the care sector to support and improve best practice in commissioning services, including supporting the sector to meet standards for good commissioning that explicitly address minimum wage and travel time issues.”

Case study: Rachel Lindfield, 26

I was a homecare worker for about 18 months. I earnt only £4 or £5 an hour – well below the minimum wage – because my company wouldn’t pay me for the time it took to travel between service users. On an average day I’d spend four and a half hours in people’s homes and over two hours travelling between them. But I’d only be paid for the time spent in their homes.

 Because calls were often organised back to back, it meant many workers were forced to cut time from calls to arrive on time to the next. I would end up leaving 10 minutes early to be on time. 

It was not until I began to work in the office to recruit care workers and read an article about this issue, that I realised that not paying care workers’ travel time was actually illegal.”

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