Do domiciliary carers have to be paid minimum wage for travel time?
Yes. Time a carer spends travelling between care calls during their shift counts as working time for the National Minimum Wage, so it has to be paid at least at the minimum rate along with the contact time itself. This is settled law, confirmed in HMRC's own guidance and in the courts, and it is the single most common reason home care providers end up underpaying without meaning to.
The rate itself is the easy part. From 6 April 2026 the National Living Wage, which is the minimum wage for workers aged 21 and over, is £12.71 an hour. Most carers are 21 or over, so that is the number to hold in your head. Younger workers and apprentices have lower minimum rates, but if you run a mixed-age rota you have to test each carer against the correct rate for their age.
Here is the part that trips people up. The minimum wage is not tested on the rate you quote in the contract. It is tested on what the carer actually averaged, once you divide their total pay by their total working time across the pay reference period. A carer on a very respectable sounding £13 or £14 per contact hour can still come out below £12.71 the moment you count the unpaid gaps between visits. LOYALS works with home care agencies across London on exactly this, and it sits at the heart of what a specialist does that a generalist misses. You can read more about the sector in our guide for healthcare and social care accountants. Most home care in England runs through Care Quality Commission (CQC) registered providers, and every one of them faces the same minimum wage test whoever pays the fee.
For the official rules, see the gov.uk guidance on minimum wage for different types of work, which sets out how care work is treated.
How the averaging rule actually works across a pay reference period
Minimum wage compliance is judged over a block of time called the pay reference period, and it works on an average. Take every hour the carer worked in that period, add up everything you paid them for it, divide one by the other, and that figure has to clear £12.71. If it does not, you have a breach, even if some visits were paid well above the rate.
The pay reference period is whatever interval you pay your carers over, and it can never be longer than one month. Weekly payers have a weekly reference period. Monthly payers have a monthly one. You cannot average a bad week against a good month to make the numbers work, and you cannot borrow next period's hours to plug this period's gap.
What counts as working time is broader than most owners assume. It includes the contact time inside the client's home, the travel time between one call and the next, genuine waiting time where the carer is at your disposal, and handover time. It does not include the ordinary commute from home to the first call of the day, or from the last call back home again, and it does not include rest breaks the carer is free to spend as they like. The distinction between travelling between appointments, which counts, and commuting, which does not, is set out in HMRC's National Minimum Wage manual on travelling time.
Why does this bite home care so hard when it barely touches an office employer? Because of the shape of the working day. A carer might do seven hours of paid contact time spread across an eleven hour day, with short unpaid hops between clients all the way through. Those hops are working time. If they are unpaid, they dilute the average. An office worker who is paid a flat salary for a fixed shift never has this problem. A domiciliary carer paid per visit has it every single day.
Where domiciliary agencies get caught
Underpayment in home care is almost never deliberate. It comes from four or five predictable places, and once you know them you can check your own rota against each one. HMRC has run targeted enforcement campaigns in social care for years precisely because these traps are so consistent across the sector.
Unpaid travel time between calls
This is the big one. If your carers are only paid for time inside the client's home and the travel between calls is unpaid, the average almost always drops below the minimum on busy days. A single unpaid twenty minute hop between two visits, repeated across a shift, can pull a £13 rate down under £12.71 with room to spare.
Per-visit pay with no working-time check
Paying a fixed amount per visit is fine in itself. The problem is when nobody converts it back to an hourly average that includes the gaps. A thirty minute call paid at £6.50 looks like £13 an hour, but if the carer spends fifteen unpaid minutes getting to the next client, the real rate for that block is closer to £8.67.
Flat travel allowances that do not go far enough
A flat allowance of a few pounds a day feels like it deals with travel, and for mileage cost it often does. For minimum wage it frequently does not, because the amount is too small to lift the averaged hourly rate back over the line once all the travel minutes are counted as working time.
Deductions for uniforms, PPE, DBS checks and training
Taking money off a carer's pay for a uniform, personal protective equipment, a DBS check or mandatory training reduces their minimum wage pay for that period. If the deduction tips the average below £12.71, it is a breach, regardless of how reasonable the cost is. This is a favourite HMRC target because it is easy to spot on a payslip.
Unpaid handover, waiting and training time
Time spent on handovers, genuine waiting where the carer cannot leave, and required training all count as working time. When these are unpaid or paid at a token rate, they drag the average down in the same way travel does. Our guide on domiciliary care mileage and travel time goes deeper on the travel side specifically, including the mileage rate that changed from April 2026.
A worked example: how £13 an hour ends up below the minimum
Numbers make this concrete. Take a carer paid £13.00 per contact hour, which sounds comfortably above the £12.71 floor. On a typical day she does seven hours of contact time, but the day also contains two hours of travelling between calls, and that travel is unpaid.
Her pay for the day is seven contact hours at £13.00, so £91.00. Her working time for the day, counting the travel, is nine hours. Divide £91.00 by nine and the effective rate is £10.11 an hour. That is £2.60 below the legal minimum, on a rate that looked generous on paper.
To be compliant, the total pay has to cover all nine hours of working time at £12.71, which is £114.39. The agency is short by £23.39 for that single carer on that single day. Multiply that across a full rota of carers and a full year and the arrears become the kind of number that funds a penalty on top.
The fix is not to slash the contact rate, and it is not to pretend the travel does not exist. It is to pay for all the working time, or to set the pay so that whatever method you use, the averaged rate never dips under the floor in any period. Which of the common pay models actually clears the line looks like this.
What getting it wrong actually costs
An underpayment is expensive in a way that catches owners off guard, because the bill is far bigger than the wages you saved. The moment HMRC, or from 7 April 2026 the Fair Work Agency, finds a shortfall, three separate costs land at once.
First, you repay every penny of arrears, and you repay it at the current minimum wage rate rather than the historic rate that applied when the work was done. On a multi-year look-back across a full rota, that alone can run into tens of thousands of pounds.
Second comes the penalty. It is 200 percent of the total underpayment, capped at £20,000 per worker. There is a carrot in there: if you pay the arrears and the penalty within 14 days, the penalty halves to 100 percent. There is no version where it is cheap.
Third is the reputational hit. Employers whose arrears top £500 are named publicly in the government's minimum wage naming rounds, and care providers appear on those lists regularly. For a business that wins local authority contracts and private clients partly on trust, being named as a minimum wage underpayer does lasting commercial damage that no penalty calculation captures.
The enforcement landscape is also tightening rather than easing. From 7 April 2026 a single new body, the Fair Work Agency, takes over minimum wage enforcement from HMRC's standalone team, consolidating labour market enforcement in one place. The rules and penalties carry across unchanged. What does not change is that home care remains one of the highest-risk sectors precisely because the travel-time and averaging traps are so widespread. You can see the current penalty policy in the gov.uk guidance on calculating the minimum wage.
Here is how the three common approaches to running care payroll actually compare on minimum wage compliance:
| What you need | DIY / spreadsheet | Generic accountant | LOYALS specialist |
|---|---|---|---|
| Counts travel time between calls as working time | ✗ You self-classify | ● If asked | ✓ Built into payroll |
| Averages pay correctly across each pay reference period | ✗ | ✗ | ✓ Checked every run |
| Tests per-visit and unsocial-hours rates against £12.71 | ✗ | ● | ✓ Per carer |
| Flags uniform, PPE and DBS deductions that breach NMW | ✗ | ✗ | ✓ Reviewed on payslip |
| Ready for Fair Work Agency enforcement from April 2026 | ✗ | ● | ✓ Records kept six years |
| Fixed monthly fee, no surprise invoices | ✓ Free | ● Hourly billing common | ✓ Fixed monthly |
This is why domiciliary agencies with more than a handful of carers tend to move payroll to a care specialist rather than run it in-house or through a generalist.
How to fix your pay model before HMRC or the Fair Work Agency does
Fixing this is a sequence, not a guess, and most agencies can work through it in an afternoon with the right figures in front of them. The goal is simple: prove that every carer averages at least £12.71 an hour in every pay reference period, and keep the records that show it.
1. Map every minute of working time
Start by listing all the time a carer is at your disposal in a shift: contact time in the home, travel between calls, waiting time and handover. Everything except the home-to-first-call commute counts. Rota software that logs actual travel between visits makes this far easier than reconstructing it later.
2. Total the pay for the period
Add up everything you paid the carer across the pay reference period, including any flat travel allowance and any unsocial-hours supplement. The period cannot be longer than one month, and you test each period on its own.
3. Divide pay by working time
Divide total pay by total working time to get the real hourly rate. If it is below £12.71 for a carer aged 21 or over, you have a breach to fix, whatever the contract says.
4. Strip out the deductions that bite
Remove any deductions for uniforms, PPE, DBS checks or tools when you test the rate. A deduction that is for your benefit as the employer reduces minimum wage pay, and if it takes the carer under the floor it is a breach even where the cost itself is fair.
5. Rebuild and keep records
Move to paying for all working time, or lift the contact rate high enough that the averaged rate clears £12.71 in every period, and keep the records for six years. If the mix of carers you employ is part of the problem, our guide on self-employed versus employed carers covers the status question that often sits alongside this one. Getting payroll and PAYE onto a system that checks the averaged rate automatically is what turns this from an annual worry into a solved problem.
What this means for you
If you run a home care agency, the honest first step is to test one real week for one busy carer, right now, using their actual travel gaps. Most owners are surprised how close to the line a rate they thought was safe actually sits.
From there the actions are practical. Log travel time properly so you are not guessing. Convert every per-visit and flat-allowance arrangement back to an averaged hourly rate and check it against £12.71. Review any deductions on the payslip. And keep six years of records, because the burden of proof in a minimum wage investigation sits with you, not the enforcement body.
None of this is about paying carers more than the market. It is about making sure the way you pay them survives the averaging test, because that is the test HMRC and the Fair Work Agency apply. Done properly it protects your margin, your reputation and the carers who keep your clients safe. You can check your agency's position in a free call with LOYALS, and we will tell you plainly whether your current model is exposed.