International law firm Trowers & Hamlins and research consultancy Agenda Consulting carried out an independent survey to analyse the issues surrounding the payment of sleep-ins and the national minimum wage (NMW). The survey which took place between 19 February and 9 March 2018 gathered responses from 109 organisations and is the most comprehensive overview of the sleep in pay crisis undertaken.
The survey shows that while care providers are increasingly aware of the sleep-in issue, less than half are funded in part or in the main by commissioners to continue providing sleep-ins. They may also now have to pay back pay to staff of up to 6 years’ of backpay where they have not paid the National Minimum Wage (NMW).
34% of those surveyed said that there would be a threat to the viability of their organisation if there’s a requirement from HMRC to back date payments to staff for 2 years, with this figure rising to 68% if the requirement is to back date for 6 years. 37% of providers have asked commissioners to fund the historical NMW liability.
Who is paying for sleep-ins at the NMW
- 61% of care providers now pay NMW for sleep-ins at or above the NMW.
- For those that don’t pay, 56% of those surveyed plan to start paying sleep ins at the NMW or above.
Less than half of commissioners are agreeing to fund current services
The survey results show that the mean percentage of service income where commissioners have agreed to fund sleep ins at NMW but not all on-costs is only 49%. For a further 7% of service income, commissioners have agreed to fund sleep ins at the NMW and all on-costs i.e. the true costs.
What can care providers do to meet the funding gap?
Care providers are now implementing a range of options to keep afloat. Respondents reported that handing back of unviable services may amount to 375 services or 1,410 service users, which represents a mean of 21% of the service users in affected providers. Nearly half (46%) of all providers would have to make redundancies. 70% are considering a renegotiation of contracts with commissioners, and 56% are considering handing services back. Other options being considered include the use of technology as an alternative for sleep ins (57%), a redesign of sleep in services alongside other services (50%), closing down services (47%), merger and sharing services with other care providers. As one provider stated, “I think it is worth highlighting the hidden ‘cost’ here also – that of the time this is taking away from the provision and development of high quality services for people with disabilities.”
Emma Burrows, Partner at Trowers & Hamlins reports:
“Having worked with many care providers on this tricky issue, it is useful to have some excellent factual data that show the extent of the funding gap of sleep-ins, the difficulty that many providers are now in, and the need for solutions to be found as soon as possible.
Interestingly, the position has changed since last year, with more commissioners agreeing to pay the NMW for sleep ins. The survey shows an increased awareness of the issue, but also highlights the potentially damaging outcome for providers, many of whom simply do not have the budget to make up the NMW shortfall in their sleep in payments. They will have to think creatively to continue to provide the same innovative and personal care.”
Tim Walters of Agenda Consulting adds:
“We are delighted to have partnered with Trowers & Hamlins on this piece of research to understand and measure the impact of the sleep in pay crisis on the future of social care. We know this is one of the critical challenges social care organisations face in the coming years and we hope that this research can contribute to the way forward.”
About Trowers & Hamlins
Trowers & Hamlins is well known for its eclectic mix of specialisations combining sector leadership in the UK and across the Middle East. We help businesses and governments change the way we live and work for the better. We do this by providing commercial advice geared towards tackling tomorrow’s challenges in industry.
We are well known for being experts in the real estate sector, and have thriving commercial, social housing, banking and finance, private wealth, employment and care practices, in addition to specialist practices such as planning, tax, pensions, and environment.
We are a top-50 UK law firm and undertake work around the globe. We have over 150 partners and approximately 830 employees. The main office is in the City of London, with three UK regional offices in Birmingham, Exeter and Manchester. Outside the UK we have more than 80 lawyers and four offices across the Middle East North Africa (MENA) region (including Abu Dhabi, Bahrain, Dubai and Oman), as well as an office in Malaysia.
For more information please contact Rebecca McCormick, PR Manager, Trowers & Hamlins LLP Tel: 0207 423 8012, Email: email@example.com
About Agenda Consulting
Agenda Consulting is a research consultancy helping not-for-profit social care and third sector organisations develop and sustain the highest levels of engagement. They offer:
- Social Care Employee Engagement Surveys
- Volunteer Engagement, Pulse, On-boarding and Exit Surveys
- Annual benchmarking study, Social Care Reward: Pay, Terms and Conditions
- Annual HR and workforce benchmarking study, People Count
- Research projects
For more information about the Sleep-in Survey contact:
Tim Walters, Principal Consultant, Agenda Consulting
Tel: +44 (0)1865 263720