New research claims 160,000 care workers subject to ‘wage theft’

Around 160,000 care workers are being paid less than the national minimum wage, each losing out on an average of £815 a year, a new study has revealed.

Research by the Resolution Foundation suggested that the amount of under-payment was worth £130 million a year.

The think tank said the “wage theft” was mainly caused by employers not paying staff for time spent travelling between clients as well as unpaid training and “on call” time.

The estimates do not take account of any illegal deductions in pay, said the report.

The Resolution Foundation said the national minimum wage should be enforced more toughly to stamp out the abuse, calling for a joint effort from national and local government as well as social care providers.

Laura Gardiner of 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.

“It’s scandalous that these workers, who do such demanding and valuable work, are being cheated out of £130 million every year through what is effectively wage theft by their employers.

“Diminishing public funding and ever tighter commissioning practices are placing great pressure on care providers, but there is simply no excuse for breaking the law and HMRC urgently needs to get tougher on employers who do so.

“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.

“Social care will need to fill up to a million additional jobs in the next decade to meet the needs of our ageing population, so tackling the broader issue of low pay in this sector is a real priority.

“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.”

Davina Ludlow, director of homecare.co.uk, a guide to home care providers, said: “Care workers provide a lifeline to some of the most vulnerable people in our society. But as the Resolution Foundation’s research confirms, they are amongst the lowest paid.”

She added: “What we need to see is the Government addressing the fundamental problem with the way home care is funded, or both carers and individuals will continue to suffer.”

TUC general secretary Frances O’Grady said: “It is criminal that care workers are not paid for the time they spend travelling and on call between appointments. Care firms who engage in this penny-pinching practice must be publicly named and shamed.

“Our social care system is in crisis because of huge cuts to local authority budgets, with many councils outsourcing services to the cheapest bidder.

“Without extra funding the care sector will continue to be a haven for zero-hours contracts and Victorian-style employment practices.”

Unison’s head of local government Heather Wakefield said: “It’s shocking that just a single small care company has been named and shamed. HMRC must target the large providers who set market rates and can afford to pay decent wages.

“Unlawful pay is endemic in the home care industry and the Government must instruct HMRC to crack down on unpaid travel time and other unlawful deductions for uniforms and mobile phones.”

A Government spokesman said: “It is not only unacceptable to pay less than the minimum wage, it is against the law.

“We are taking action to make it easier to name, shame and fine offenders, as well as helping social care workers to recover the hundreds of thousands of pounds in pay owed to them. We are also looking at what more we can do to make sure social care workers are paid fairly in the first place.”

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