Home care agencies warn sleep-in back pay bill will cause redundancies

A fifth of home care workers could face redundancy if home care providers and charities are forced to give care workers back pay of up to six years, for overnight shifts.

A survey has revealed that 20 per cent of front line staff are at risk of losing their jobs if the Government forces providers to compensate workers for lost earnings.

Last year the Government said care providers had to pay back home care workers, after two tribunal cases found care staff were only being paid a flat rate allowance rather than the minimum hourly wage.

However providers are saying they can’t afford to and want the Government to take responsibility for funding the back pay.

Rhidian Hughes, chief executive of the Voluntary Organisations Disability Group (VODG), said: “The social care sector is facing an existential threat caused by sleep-in pay which is entirely due to unclear and changing Government guidance. Being hit with an unexpected liability for back pay is unfair to the people who rely on care, but also care workers, local authorities and providers of these crucial community services.

“The solution is simple: Government must fund all care work, including sleep-in shifts, at the National Minimum Wage and pay the back pay owed to care workers for the past six years.”

He claims that it is the Government which is in the wrong as it allocates money to the local authorities which then purchases the care from the home care agencies. So providers would be paying back money they never received.

Dr Hughes said: “Government rightly funds care services for our most vulnerable citizens – and over the last six years has not funded them at the National Minimum Wage. Now, they must rectify their mistake. The care sector should not be forced to pay for a Government error – particularly when the future of the sector is in jeopardy.”

The survey by Agenda Consulting and Towers & Hamlins LLP found that nearly a third of people could have their home care disrupted in the next year as providers will be forced to hand back contracts due to affordability issues.

It also revealed that the sleep-in back pay bill will make the majority of care providers unviable and that the majority of care providers have not budgeted for the back pay bill.

Some providers will be forced to sell homes which provide care for disabled people, while others will be forced to end services in some regions, according to the survey which found 70 per cent are considering a renegotiation of contracts with commissioners, and 56 per cent are considering handing services back.

Tracy Hammond from Learning Disability England said: “Those who depend on care services are already marginalised and this survey proves that the sleep-in pay crisis will result in vulnerable people having less choice and less control over their care – unless a solution is found quickly.

“We urge the Government to fund the back pay liability and ensure proper funding for the care sector moving forward.”

It is estimated the amount of back pay owed to care workers for overnight shifts over the last six years may be as much as £400m.