“Exceptional measures” announced by the government to tackle the issue of sleep-in pay for social care workers have failed to address concerns huge back-pay bills could destabilise the sector.
This morning the government said social care providers will not face penalties if they have failed to pay workers on sleep-in shifts the minimum wage prior to today’s date and admitted previous guidance from HMRC on the issue was “potentially misleading”.
However, providers will still be required to make backdated payments to affected workers, a bill which the learning disability charity Mencap said would run to £400m. Providers will also be required to pay the national minimum wage for such shifts in future.
Last week the Local Government Association and Association of Directors of Adult Social Services warned the additional costs associated with replacing current flat on-call payments with an hourly wage would threaten the fragile provider market in which providers were already closing or handing back contracts.
This morning the Department for Business, Energy & Industrial Strategy announced a series of “exceptional measures” it said were aimed at “minimising disruption to the sector”.
A note published alongside the announcement acknowledged the concerns about the impact on the market. It said: “The government recognises that the cumulative financial liability of penalties and arrears of wages could pose significant challenges to the social care sector. In extreme circumstances, providers may be unable to meet their obligations to repay their workers.”
It said the government would work with the sector “to see how it might be possible to minimise any impact on provision of social care as a result of this situation”.
However, Mencap chair Derek Lewis warned the £400m back-pay bill would have a “catastrophic impact” on providers and the people they care for.
He said: “As the government well knows, the critical issue for providers of vital sleep-in care for those with serious learning disabilities is the unfunded liability for six years’ of back pay.”
Providers have claimed that guidance from HMRC on the issue has been confusing. This morning DBEIS acknowledged this saying: “The government recognises that written guidance published before February 2015 was potentially misleading.”
Mr Lewis said the government should pay for the impact of the rule change.
“We reiterate our call to government to accept its responsibility and make an urgent commitment to fund the back pay bill, for the sake of those vulnerable people who depend on this care and for the dedicated people who provide that care,” he said.
The DBEIS declined to respond to this call. In the note published this morning it highlighted the additional £2bn made available for social care in the March 2017 Budget.