The Fair Work Agency has secured £107,935.96 for care workers who were not properly reimbursed for business mileage, following an investigation into a provider’s arrangements at two English branches.
The enforcement action concerned domiciliary care workers based in Mansfield and Northampton who incurred travel expenses while carrying out their duties.
Investigators found that the employer had not reimbursed those expenses appropriately, resulting in underpayments affecting both current and former employees.
The amount identified for repayment includes £61,343.93 owed to workers at the Mansfield branch and £46,592.03 at Northampton.
The employer, which has not been publicly named, accepted that staff had been underpaid and took steps to correct its arrangements following discussions with the agency.
It has also increased its mileage reimbursement rate from 5p to 40p per mile for 2026.
The government has not disclosed how many employees were affected or the period over which the underpayments accumulated.
The agency’s announcement confirms that the money has been secured for the affected workers, but does not establish that every individual repayment has already been completed.
The investigation began after information was provided to the Fair Work Agency’s contact centre, prompting officials to examine the employer’s mileage payment practices.
Work-related travel creates payroll obligations —
Domiciliary care workers frequently travel between clients’ homes during the working day, making transport an integral part of providing services.
Those journeys differ from ordinary commuting because employees are travelling between work assignments rather than simply getting to or from their normal workplace.
Employers must account for qualifying travel time when assessing compliance with minimum wage requirements.
Costs incurred by employees in connection with their work can also affect whether the pay they receive meets the applicable legal minimum.
Government guidance makes clear that certain unreimbursed employment expenses reduce the amount treated as minimum wage pay.
Where workers must use their own vehicles to carry out duties, the employer therefore needs to consider both the time spent travelling and the expenses incurred.
The precise calculation depends on the employment arrangements and the applicable minimum wage rules.
There is no general requirement for every employer to reimburse all business mileage at 40p per mile. The rate adopted by the care provider following this investigation is specific to its revised arrangements.
Similarly, HMRC’s tax-approved mileage allowances do not automatically determine an employer’s minimum wage obligations.
The agency’s findings concern an employer whose previous reimbursement practices resulted in substantial amounts being owed across two branches.
Compliance risks extend across employers —
Although the investigation involved care workers, similar administrative issues can arise wherever employees regularly travel between assignments.
Maintenance businesses, cleaning companies, field service providers, and other employers operating mobile workforces may face comparable challenges in recording journeys and reimbursing qualifying expenses.
Payroll calculations can become more complicated when workers undertake multiple appointments during a day, receive different rates of pay, or use their own vehicles for business travel.
Accurate records are needed to establish the time worked, relevant expenses, reimbursements, and amounts paid during each pay reference period.
The Fair Work Agency’s findings demonstrate how a recurring payroll practice can generate a substantial cumulative liability when it affects multiple employees over time.
A spokesperson for the agency said the recovery would make a significant difference to affected workers and demonstrated the importance of ensuring employees received their legal entitlements.
The agency said it would continue working with employers and workers to improve compliance and awareness of employment rights.
Earlier in November, a separate enforcement case secured approximately £59,000 for five IT agency workers following an investigation into withheld wages. The cases involved different circumstances but both concerned employment payment arrangements that required corrective action.
For the unnamed care provider, the investigation has resulted in £107,935.96 being identified for repayment and a higher mileage rate for 2026.
The outcome highlights the financial exposure created by inadequate expense records and reimbursement arrangements, particularly where the same approach is applied across a substantial workforce.
