The government is under pressure to reform care laws after the supreme court ruled that support workers on “sleep-in” shifts are not required to be paid the national minimum wage for hours when they are not awake..

The decision ends a four-year legal battle involving two care workers and the learning disability charity Mencap that threatened to leave care providers with a potential £400m back-pay bill potentially jeopardising the care of vulnerable people.

The court said care workers should only be paid the national minimum wage hourly rate on sleep-in shifts when they were awake for the purposes of working.

While it ends the immediate possibility that huge back-pay bills would force care providers to close, the decision means thousands of care support workers – already on low incomes – potentially face substantial cuts in earnings.

Unison called the ruling “a huge blow” for thousands of care workers. The union’s general secretary, Christina McAnea, said: “No one is a winner from today’s judgment. Everyone loses until the government intervenes to mend a broken system that relies on paying skilled staff a pittance.”

Clare Tomlinson-Blake, one of the care workers who brought the case, said: “This case was never about the money. ​It was about the principle of treating staff fairly. Sleep-in shifts aren’t about just being on call – it’s work. Staff are constantly on guard to protect the most vulnerable in society.”

Read more in the Guardian.