There is increasing recognition that a better deal for the workforce will be essential to the quality and sustainability of social care provision in the UK, but so far there has been scant evidence as to the scale of investment needed. The Resolution Foundation is currently undertaking a major investigation into the costs of improving care worker conditions – via things like paying the living wage and enhancing pension contributions – and the wider savings that would result, for example through lower tax credit spending as wages rise.
But before we consider the costs and benefits of improvements like these, it is essential to ensure that pay levels at least comply with the law. The National Minimum Wage is a right, not a privilege, but previous research has shown that a significant minority of frontline care workers are not receiving it. This note describes how we have developed this previous research by estimating the quantum of wages missing from frontline workers’ pockets each year due to minimum wage non-compliance on the part of care providers.
- Social care workers are losing out on an estimated £130 million a year due to pay rates that are in breach of the National Minimum Wage.
- Around 160,000 care workers (out of 1.4 million) are being 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.
- The minimum wage underpayment is primarily down 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 will have to make a number of journeys between clients each day. It’s also due to unpaid training time and ‘on call’ time.
- A joint effort is needed by national government, local authorities and social care providers to end this failure to comply with the minimum wage and start to address the wider problem of pervasive low pay.
- Employers must commit to better treatment of their staff, local government must take greater responsibility for the behaviour of care providers, while national government must recognise the impact of reduced social care budgets on the funding available to local authorities for care contracts.