Representing clients who engage carers
- PROPER TERMS OF AGREEMENT
It is always best to have a proper agreement with carers. If the carer is employed, then it is necessary to comply with relevant employment legislation including the provision of minimum information to the carer. This requirement is set out in section 1 of the Employment Rights Act 1996. The requirement includes information in relation to the date when the employment began, job title or a brief description of duties, remuneration, hours of work, holidays, sickness, pension, and disciplinary and grievance procedures. The contract should contain other clauses, and in particular a confidentiality undertaking.A GDPR privacy notice should be also issued to the carer (- whether employed or self- employed).It is important for the employer to comply with other employment legislation such as properly carrying out statutory right to work checks. Please see the Home Office guidance as set out at https://www.gov.uk/check-job-applicant-right-to-work. The maximum fine by the Home Office is £20,000 per worker.Right to work checks involves looking at original documents such as passports, a biometric residence card or national identity card or other specified documents, and also retaining copies and making a record of the date when the copies were made. The procedures are administrative. If not complied with then there will not be a statutory defence as against the Home Office if it endeavours to impose a civil penalty.It’s also necessary/compulsory to effect employers liability insurance and also sensible, to also effect public liability insurance cover in relation to the carer in relation to anything which the carer may undertake in the course of their duties.A normal template employment agreement really should not be used since a care engagement has special features which need to be set out and covered within the employment agreement.
- The danger of a self-employed contract being as a matter of law an employment contract.
There has been a recent line of authorities where the Court has held that workers who on paper were stated as being self-employed were as a matter of law in fact employees. Whether a person is an employee or self-employed is a matter of law and there are a number of legal tests which the Court will apply in determining the true nature of the relationship. The fact that the agreement specifies the relationship to be self-employed is not conclusive. If the Court makes a finding that the relationship is, in reality, an employment relationship (and not self-employed) there may be significant issues including in relation to PAYE tax and employer’s national insurance contributions throughout the whole duration of the relationship. So, it is important if possible, for the contract to set out the correct relationship with the carer, to avoid any exposure to these risks. One important fact is whether the carer works for only one person. If that is the case, there is a serious risk that the Court may find the relationship to be in fact one of employment.If the carer works for a number of different persons, then this again is indicative of a self-employment relationship. Another key factor is whether the carer has a genuine right to substitute another carer to carry out the relevant work. If not this again points to an employment relationship.It is useful to obtain legal advice as to whether a relationship is likely to be one of employment.It is a dangerous situation to label a carer as being self-employed where the carer works for only one person over a long period of time.
- Self-employment agreements
If there is a self-employed relationship it is also important to provide a properly detailed agreement. This should include clauses such hours of work, rates of pay, a tax indemnity – which is important if the Revenue determines the relationship is, in reality, one of employment, and a confidentiality undertaking.Such agreement may also need to be constructed to apply in relation to multiple engagements.
- Working Time Regulations
The Working Time Regulations 1998 set out the maximum hours an employee can work, as well as providing for minimum rest breaks, minimum rights to holidays and holiday pay. The holiday provisions of the Regulations apply to “workers” which are defined in the Regulations as follows; –“worker” means an individual who has entered into or works under (or, where the employment has ceased, worked under)—
- a contract of employment; or
- any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual;
It is important that the carer if employed is not required to work more than the statutory maximum number of hours and the hours which a carer should work should accordingly be spelt out in the employment agreement. This is a particular problem for live-in carers.
The statutory requirements for working time for employees as follows:
- Daily rest periods – An adult worker is entitled to a rest period of not less than eleven consecutive hours in each 24-hour period during which he works for his employer
- Weekly rest periods – an adult worker is entitled to an uninterrupted rest period of not less than 24 hours in each seven-day period during which he works for his employer. It is possible to spread the period for which the statutory minimum weekly rest breaks are calculated over a period of 2 weeks.
- Daily rest periods – Where an adult worker’s daily working time is more than six hours, he is entitled to a rest break and generally this will be an uninterrupted period of not less than 20 minutes.
- Maximum Weekly Working Time – A worker’s working time, including overtime, in any reference period which is applicable shall not exceed an average of 48 hours for every seven days. It is possible under paragraph 5 of the Regulations for an employee to opt-out of this requirement- and it is common for an opt-out clause to be included within an employment agreement. An opt-out clause is in particular important where there is a live-in carer.
- Minimum Statutory Holidays and Holiday Pay – this relates to workers within the meaning of the Regulations- as defined as above. Under the Regulations, a worker is entitled to statutory minimum holiday leave as well as holiday pay. Statutory holidays are a minimum of 28 days a year to include bank and public holidays. Holiday pay is also payable.
- National Minimum Wage (“NMW”) – the minimum wage legislation relates to workers- as defined above. As from 1st April 2020, for an adult over 25 years old or above the NMW is £8.72 per hour. There are reduced rates for the NMW for workers under 25 years old as set out below; –
- those aged 21 to 24 will receive £8.20 per hour
- those aged 18 to 20 will receive £6.45 per hour
- those aged 16 to 17 will receive £4.55 per hour
The NMW rates usually increase every year. New rates should accordingly apply as from 1st April 2021.There is a difficulty for live-in carers since the NMW is payable for times when the carer is on standby or on-call.
There is also uncertain legal clarity in relation to the relationship between the NMW and sleeping time.
There is an important case currently being decided on appeal in relation to this issue by the Supreme Court.
- Service Occupancy granted to live-in carers
If the carer lives in the property and shares accommodation with the employer/principle (if self-employed) then the agreement will be an excluded agreement within the meaning of the Protection from Eviction Act 1977. This means that the various protections of that Act will not need to be complied with – including the requirement to obtain a Court order before evicting the carer from the premises.An occupation agreement (by virtue of section 3A(2) of the Act) will be excluded from the provisions of the Act if; –“(a) under its terms the occupier shares any accommodation with the landlord or licensor; and(b) immediately before the tenancy or licence was granted and also at the time it comes to an end, the landlord or licensor occupied as his only or principal home premises of which the whole or part of the shared accommodation formed part.”The particular problem in the legislation that to be excluded the employer/principle needs to be in occupation of the property both when the occupation agreement starts and ends.This immediately gives rise to a problem if the person engaging/contracting with the carer should be a relative of the person being cared for. It is accordingly important to ensure that the relevant contract with the carer is entered into by the person being cared for – if necessary, by an attorney and not the relative.The second problem is that the licence should end on the death of the person being cared for. (The contract with the carer is in fact frustrated or terminated upon the death of the employer by operation of law). It is important for the personal representatives of the employer not to extend the licence for the carer to live in the property after death because this will give rise to the loss of the excluded status.If a Court order is required to evict a carer from the premises this may take quite some time (several months) and may result in material legal costs being incurred in order to obtain such an Order. Accordingly, it is important for the licence agreement is properly worded in relation to this issue.It is best practice to provide a separate service occupancy agreement to a carer as opposed to incorporating terms in relation to such occupation within the main employment or self-employment contract.
- Death of the Employer
An employment agreement with a carer, will be frustrated and come to an end automatically by operation of law upon the death of the person being cared for.No notice money will be payable but if employed for at least 2 years the carer will be entitled to a statutory redundancy payment. Any accrued holiday will also need to be paid to the carer.
These should be set out in detail in the relevant agreement including where relevant, accompanying the person being cared for to hospital or doctor appointments, buying provisions and looking after the house and carrying out light housework etc.
We would be very pleased to discuss the situation by telephone initially at no charge. However if you wish to instruct this firm to provide detailed advice and to draft agreements etc., please can you send an email to Lawrence Rodkin, partner at firstname.lastname@example.org Alternatively you can telephone our office at 0208 446 6223
We are still operating despite the COVID-19 lock-down. Our fee earners are mostly working from home with our office manager working in the office. We are currently not physically meeting with our clients, but this is not necessary. We can undertake our work through email and telephone and we also have capacity for internet meetings via Zoom.
Our fee rates are transparent and are set out on our website at https://www.sr-law.co.uk/simons-rodkin-solicitors-fee-structure/.
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