Carers lose £130 million in pay due to minimum wage breaches

Older people

Social care workers are losing out on £130 million a year due to pay rates that are in breach of the national minimum wage, according to research by independent think-tank the Resolution Foundation.

Its analysis is part of an investigation into improving pay in social care, which is due to conclude early next month and estimates that around 160,000 of the UK’s 1.4 million care workers are paid less than the minimum wage when all working time is considered.

The average loss for those not receiving the minimum wage is around £815 per year per worker.

The wage losses are primarily due to the failure of employers to pay staff at a level that adequately covers all of their working time. This includes time spent travelling between clients for domiciliary care workers, many of whom have to make a number of journeys between clients each day. It is also due to unpaid training time and ‘on call’ time.

Between 2011 and 2013, HM Revenue and Customs recovered £338,835 pay arrears for 2,443 workers in the sector, leading to penalties of £112,786 being charged to the employers.

Laura Gardiner, senior research and policy analyst at The Resolution Foundation, said: “Every worker has the right to the minimum wage, yet illegal non-payment is all too common in the social care sector.

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 “There is simply no excuse for breaking the law and it’s welcome that the government has started to draw attention to this issue and beefed up enforcement powers but far more needs to be done given the scale of abuse.

“As well as helping to attract and retain staff and boosting the incomes of low-paid workers, better pay would ultimately lead to improvements in care quality. If we want to see dignity for those receiving care then we need to start investing in the workers who provide it.”