Disability group accuses HMRC of creating 'uncertainty' over sleep-in care back pay

Voluntary Organisations Disability Group says the government's latest letter to social care providers has caused confusion

The Voluntary Organisations Disability Group has accused HM Revenue & Customs of creating "uncertainty" after it told social care charities to continue calculating the back pay they owe to sleep-in care providers or possibly face investigation, despite a lack of government guidance on the issue.

Social care charities had faced paying significant sums to sleep-in care workers after an employment tribunal ruling in 2015 found a former Mencap care worker, Claire Tomlinson-Blake, was entitled to receive the national minimum wage for each hour of sleep-in shifts completed, plus six years of back payments.

Charities had previously typically paid sleep-ins a flat rate of between £35 and £45, plus an hourly rate for any time spent providing care rather than being asleep.

The government set up the Social Care Compliance Scheme for social care providers to calculate and repay back pay owed to their care workers, which could have cost the sector a total of £400m

But in a case brought by Mencap last month, the Court of Appeal ruled that social care providers, including many charities, did not have to pay significant sums in back pay to sleep-in care workers.

Despite this, the VODG says that HMRC has written to social care providers to tell them they should continue making self-reviews under the SCCS of the back pay they owe.

HMRC’s communication also says that all self-reviews must be submitted either by the end of 2018 or 12 months after their application to the SCCS, whichever is sooner.

All arrears owed to staff must then be paid within three months of returning the declaration or by 31 March 2019, depending on which is sooner, the communication from HMRC says.

The communication says that failure to adhere to the terms or timeframes of the SCCS or withdrawal from the scheme could result in an HMRC investigation into the organisation’s pay practices.

This is despite there being no official guidance from the government on how social care providers should interpret the Court of Appeal verdict, with an announcement from the Department for Business, Energy and Industrial Strategy expected shortly.

Last month, the VODG also reported that HMRC had written to social care providers advising them they could stop calculating the amount they owe in back pay to sleep-in workers after the Court of Appeal’s verdict.

Steve Scown, chair of the VODG, said: "The sector is waiting for official guidance from the Department of Business, Energy and Industrial Strategy. We have worked with officials to inform the development of policy options yet are today surprised to learn that providers are opening a confusing communication from HMRC.

"Providers expect clarity, not uncertainty, from HMRC. We are calling on government to explain why HMRC has jumped the gun and acted before the BEIS has issued official guidance."

Unison, which brought the original tribunal case against Mencap, has applied to appeal the Court of Appeal’s verdict, and a decision is expected within the next month.

Mencap has criticised Unison’s decision to apply to appeal, saying it "will unnecessarily delay having a final conclusion to this very damaging period of uncertainty".

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