Vulnerable people could lose ‘vital care’ after HMRC demands £400m bill, warn charity chiefs
Dozens of leading charities could face insolvency within weeks after the Government ruled they must pay millions of pounds in back payments to overnight carers. Around 200 disability charities, including Mencap, are said to face a bill of around £400m in back payments after new guidance was issued stating overnight carers must be paid the national minimum wage (NMW) for all hours.
Vulnerable people with learning difficulties face losing “vital” care as a result of the bills, charities have warned, with around 5,500 supported by Mencap alone set to be “majorly impacted”, while some may end up losing that support all together.
Under guidance issued by the Government in 1999, when the minimum wage was introduced, disability charities, which sent a carer overnight to look after someone with learning difficulties, were required to pay a flat rate “on call” allowance of £25 or £35 to cover the period when they were asleep.
But, following two tribunal cases in 2015 and last year, the Department for Business, Energy and Industrial Strategy (BEIS) changed the guidance in October to state that these organisations must now pay the minimum wage throughout the shift, meaning overnight carers would earn £60 for eight hours of sleep.
Mencap and other charities and companies are now warning that they cannot afford the huge and unexpected additional sums being demanded by HM Revenue & Customs (HMRC), even though they believe their staff should get the higher pay levels demanded by the business department.
Derek Lewis, chairman of the Royal Mencap Society, said “sleep-ins”, which are widely used in the sector, rarely see the carer disturbed during the night, citing research showing that 99.7 per cent of them slept peacefully.
“Sleep-ins are widely used in the learning disability sector to provide care for some of our most vulnerable adults, in their own homes in the communities they live in,” he said.
“The carer is only there ‘just in case’ to provide safety and reassurance and is rarely disturbed. Recent research which looked at the last three years showed that 99.7 per cent of carers slept peacefully.
“The unintended consequences have been disastrous as HMRC have begun enforcement action demanding six years’ back pay. Estimates of the costs to the Learning Disability sector are in the region of £400m and Royal Mencap Society will be severely affected.”