Wake-up call – Sleeping on the job

Are you duty bound to pay someone while they stay overnight at your operation? Paul McMahon says employers need to wake up to the issue

THE PROBLEM
A pub manager's contract specifies that she will "reside and sleep on the premises". She has no duties to perform and does not have to be on the premises at all times. Should the time spent overnight be taken into account in assessing whether she receives the national minimum wage?

THE LAW
The Working Time Regulations 1998 limit working hours and provide for rest breaks and holidays. ‘Working time' is defined as: any period during which the worker is working, carrying out his duties, and at the employer's disposal; any period during which the worker is receiving ‘relevant training'; or any additional period which is agreed to be ‘working time'.

Provisions relating to the national minimum wage are contained in the National Minimum Wage Regulations 1999. The National Minimum Wage Regulations categorise work as either timed work (hourly paid work), salaried hours work, output work (work that earns commission) or unmeasured work (any work that does not fall into one of the other categories).

Crucially, the National Minimum Wage Regulations contain exceptions in relation to a worker "who by arrangement sleeps at or near a place of work and is provided with suitable facilities for sleeping" and say that time spent using those facilities for the purpose of sleeping "shall only be treated as being salaried hours work when the worker is awake for the purpose of working".

EXPERT ADVICE
There is a fair amount of case law on whether "sleep-in" periods constitute work for the purpose of the National Minimum Wage Regulations.

In a recent case the Employment Appeal Tribunal took the view that, for minimum wage purposes, there is a clear divide between situations where an employee is provided with sleeping accommodation and at most is on call (as in the case of a hotel manager) and other situations where an employee is working merely by being present at the employer's premises (eg a night porter), whether or not provided with sleeping accommodation.

In an ‘on-call' situation, an employee may be able to call upon the Working Time Regulations and claim that all on call hours are working hours. However, they won't be able to bring those hours into account for the purposes of a minimum wage claim because only hours when they are awake for the purpose of working will be counted.

However, if an employee is required to perform certain tasks or undertake responsibilities during the night (such as dealing with phone enquiries or undertaking the responsibilities of a night-porter), they are deemed to be working throughout the period, even if actual tasks only come up intermittently or infrequently and they are free to sleep in between tasks.

In the case of the pub manager, the Tribunal decided that the hours that she spent on the premises overnight should not be taken into account when calculating her hourly rate of pay, since she did not have to do any work during that period and had no responsibilities.

CHECK LIST

â- Where an employee has duties or responsibilities that are carried out overnight, ask:
1. Can the employee properly be described as being ‘on-call'?
or
2. Is the employee working throughout the night (even though they might sleep between tasks)?

â- Know the difference between the two in relation to the calculation of an employee's average hourly wage for NMW purposes.

â- Keep accurate records of the hours worked by, and payments made to, workers.

BEWARE!
A worker who does not receive the minimum wage may bring a claim for breach of contract (these arrears can be claimed going back up to six years [up to five years in Scotland] prior to the claim) or for unlawful deduction from a worker's wages (there is no limit on the length of arrears that can be claimed, provided it is all part of the same series of unlawful deductions).

It is a criminal offence to fail to keep records, keep false records or produce false records and is punishable on summary conviction by a fine.

CONTACT
Paul McMahon is a partner at Brodies LLPpaul.mcmahon@brodies.com