Mitie marketing (www.mitie.com)
Anne’s first call started at 7am and her last finished at 10pm. She went from house to house, calling in on vulnerable clients, 15, sometimes 20 calls each day, helping clients to wash and dress, emptying and cleaning their commodes, administering their medicine, preparing their meals, keeping them company — the only person they might see all day.
Anne worked for MiHomecare, one of the corporate chains that dominate the UK home care market. She was one of 220,000 care workers in the UK last year being paid less than the minimum wage — (then £6.70 per hour, now £7.20).
Facing legal challenges, negative publicity and reputational damage, MiHomecare’s parent company Mitie stated early this year: “We have found some errors in calculating travel time pay and we have decided to make a one-off payment to all affected people. Additionally we took steps in June 2015 to ensure that this should not be an issue in future by revising some pay rates and amending care rosters.”
Mitie (pronounced Mighty) had “completed a comprehensive review of payments for all of our care workers to be absolutely certain that they are treated fairly and that we comply with wage legislation”.
This was a rare positive story from a market usually in the news for substandard care or chronic under-funding. But, according to Anne and other care workers who have called Corporate Watch since, this wasn’t quite the good news story it first appeared.
Anne, who worked in MiHomecare’s Eastbourne branch, has been offered no compensation. Nor have colleagues, who appear to be owed it.
Anne’s rotas, seen and analysed by Corporate Watch, suggest that she was being paid significantly less than the minimum wage — approximately £40 a week less. Her stated pay rate was £7.50 per hour on weekdays and £9 on weekends but she was not paid for her time travelling between appointments, as she legally should have been. In the week analysed her actual pay worked out at just £5.70 an hour. If that was the case across the year, as she says, Anne could be owed over £2,000 from just one year.
“Some weeks were even worse than that one,” Anne told us. “I felt so down by the end of the week. It was affecting the rest of my life. I care so much for the clients but the company just run you straight into the ground.”
Other workers in the branch told us of similar experiences. Karen said she regularly worked between 7am and 1pm without a break, but that she would often be paid for just two or three hours. Jane’s rotas suggested she was still being paid less than the minimum wage in February – after Mitie’s guarantee that care workers would never again be illegally underpaid.
According to reports from other branches where compensation was offered, most workers accepted it, glad of the unexpected and much needed cash. But many people we spoke to were sceptical that the amounts offered covered everything they were owed.
One problem was that the compensation letters gave no breakdown or calculation showing how amounts had been worked out.
Some care workers, told that if they queried the amount they may be offered even less, were understandably reluctant to do so.
Emma won’t budge
One MiHomecare worker in London did challenge her offer. We’ll call her Emma. After working for the company below the minimum wage for over three years, Emma was offered just over £250. She refused to sign the settlement. In response MiHomecare reduced the amount. Emma asked the company to send documentation showing the hours she had worked. Calls started coming in from head office asking her to accept the original offer. Emma wouldn’t budge.
Instead, Emma went through the timesheets she had requested and worked out that she had actually been paid around £900 less than the minimum wage once travel time and gaps between appointments had been taken into account — that’s more than three times the original offer. Perhaps worried about the prospect of another high profile legal claim, MiHomecare relented and even paid slightly more than she had demanded.
Emma says: “It took a long time but I got what I was owed. I knew it wasn’t enough. It’s just a shame all those other people accepted theirs when they could have challenged it.”
The typical strategy of the corporate chains that increasingly dominate home care is to buy up smaller rivals while cutting costs. Staff wages make up by far the biggest cost. Severe cuts in council funding have put financial pressure on home care providers: but there’s a limit to how much the increasing number of home care companies owned by big businesses or investors can blame inadequate public funding for not paying their workers properly.
Home care hasn’t been the money-making business Mitie hoped it would be when it paid £111m for the home care company Enara in 2012. At the time, Mitie chief executive Ruby McGregor-Smith told Reuters: “We have a very rapidly ageing UK population and the care market is highly fragmented. We think the opportunities coming out will get much bigger in scale in the next few years with maybe some adjacent services, for example looking after community care as a whole for a local authority.”
Four years on things haven’t turned out as planned. Homecare was part of the reason Mitie sprang a nasty surprise on shareholders last month with the announcement that this year’s group profit would be “materially below management’s previous expectations”. MiHomecare’s accounts show that it has turned a profit only once in the past four years, with its most recent accounts showing a loss of £7m.
Back in October 2010, Ruby McGregor-Smith was one of 35 business leaders who signed a letter in the Daily Telegraph urging the government to press on with public spending cuts. She was made a CBE in the 2012 New Year’s Honours List. Then, in August 2015, the government made her a member of the House of Lords, at the same time as her company was under investigation by HMRC for failing to pay the minimum wage. In December last year she was appointed a non-executive board member of the Department for Education.
Ruby McGregor-Smith, chief executive, Mitie (Ed Robinson/OneRedEye)
While her workers were being paid less than £6 an hour, how did Mitie’s chief executive fare?
The answer is on page 86 of Mitie’s Annual Report & Accounts. In the year to March 2016, Ruby McGregor-Smith’s basic annual salary was £565,950.
Plus £25,855 in “benefits”. Then a bonus: £659,332, won in part thanks to “Implementation of the MiHomecare business plan”.
On top of that, something called a “long term incentive plan” or LTIP award: £1,167,006. Plus, pension contributions: £152,577. And then £1,692 listed under “other”, taking the grand total to £2,572,412. Or £7,000 per day.
“The job I’m paid for is whackingly different to the job everyone else does,” McGregor-Smith told the Financial Times late last year.
McGregor-Smith remuneration, year to March 2016 & 2015 (Mitie Report & Accounts 2016)
Questioned about Mitie’s decision not to pay home care workers for travel time between jobs, she said: “That was down to the interpretation of travel time. We’ve dealt with that. If there’s any historical issues on pay we deal with them.”
Quality of care
All the care workers we spoke to said they cared deeply about providing a decent service to the people they look after, with many going over and above their paid hours to do so. They also described coming into clients’ homes to find medicines not given, commodes left unemptied and incomplete care records.
Inevitably, if a company hasn’t been investing in a service as much as it should, the quality of care will be affected.
Published statistics, reported here for the first time, show almost half of MiHomecare branches assessed in the past two years have been found unsatisfactory by the Care Quality Commission.
Out of 28 MiHomecare branches assessed since April 2015 by the Care Quality Commission, 11 have been rated as requiring improvement, with the Poole and Wiltshire branches rated inadequate and placed in special measures.
Some of these branches — branded not “sustainable” in the accounts — have since been closed to cut costs. According to a Mitie spokesperson, recent, as yet unpublished, inspections have rated two thirds of the remaining 23 as good, with none now inadequate.
It remains hard to reconcile Mitie’s £57m payout to shareholders over the last year with the CQC’s inspection of the Wiltshire branch in June, which identified shortages in staff numbers and training, medicines not being “managed safely” and “little evidence that staff received support when requested”.
None of this is unique to MiHomecare. Another major company, Sevacare, is being taken to court for failing to pay its workers minimum wage — while paying its boss £2.4m in 2014.
The recent experience of MiHomecare workers shows that, with little regulation or collective organising, getting a fair deal out for home care will continue to be a struggle.
In March 2016, when Corporate Watch sent Mitie’s press office questions about payments to care workers, we received a reply from Schillings, the heavyweight libel lawyers, insisting that we either drop our story or give prominence to the following statement:
“MiHomecare prides itself on providing the highest standards of care and we are absolutely committed to paying our people correctly for their work. Whenever we receive payroll queries we review them and resolve them as soon as possible. HMRC is totally satisfied with our approach.”
All care workers’ names have been changed. If you have any information about a care company you would like to share, message Corporate Watch here or call 02074260005.
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