The end of the family worker exemption?

The Secretary of State for Business, Energy and Industrial Strategy has withdrawn from litigation in which it was defending a challenge to the legality of the family worker exemption in the Minimum Wage Regulations.

The exemption was introduced in 1999 to allow families to avoid paying their au pairs. If a worker lives as part of the employer’s family she need not be paid the minimum wage. The exemption is routinely relied on by employers of migrant domestic workers, often in circumstances where the worker is subjected to gravely exploitative and demeaning treatment and excessive hours of work with little or no pay. In many cases, workers in these jobs are victims of human trafficking. If the exemption is set aside, thousands of severely disenfranchised workers will be entitled to the dignity of a wage for their labour.

Specialist Employment and Discrimination barrister Akua Reindorf, instructed by the Anti-Trafficking and Labour Exploitation Unit, represents the Claimant Kamalammal Puthenveettil, a migrant worker who challenges the family worker exemption on the basis that it indirectly discriminates against women. The Claimant will argue at a remitted Employment Tribunal hearing that women form the vast majority of workers who are denied the minimum wage because of the exemption, and that it should therefore be set aside or read consistently with EU law prohibiting discrimination.

The Secretary of State was joined to the proceedings to defend the exemption. Having conceded that if the exemption is indirectly discriminatory it should be set aside, it has now withdrawn from the proceedings and will offer no evidence or submissions to seek to justify it.

The Secretary of State now accepts that if the Claimant establishes that, on the face of it, women including herself are put at a particular disadvantage because of the exemption, the Tribunal should find that the exemption is unlawful and set it aside (subject to any representations made by the Claimant’s former employers).

The family worker exemption was originally contained in Regulation 2(2)(a) of the National Minimum Wage Regulations 1999 and is now in Regulation 57 of the National Minimum Wage Regulations 2015.

The hearing will take place at London South Employment Tribunal on 4 and 5 February 2019.