Time spent travelling to and from first and last appointments of the day should count as working time, the European Court of Justice has ruled.
The Luxembourg-based court declared that workers without a fixed office or workplace are "carrying out their activity or duties over the whole duration of those journeys".
Trade unions believe the judgment, which takes effect immediately, could be a big boost particularly for tens of thousands of low-paid home care workers whose costs for commuting to their clients' homes are not covered.
British business leaders said the Government will have to come up with a strong definition of what a "normal workplace" can be.
The ruling said: "The Court takes the view that the workers are at the employer's disposal for the time of the journeys. During those journeys, the workers act on the instructions of the employer, who may change the order of the customers or cancel or add an appointment.
"During the necessary travelling time - which generally cannot be shortened - the workers are therefore not able to use their time freely and pursue their own interests."
Anyone who has to commute to these jobs is also considered to be working during these journeys, the court ruled.
It stated: "Given that travelling is an integral part of being such a worker, the place of work of that worker cannot be reduced to the physical areas of his work on the premises of the employer's customers.
"The fact that the workers begin and finish the journeys at their homes stems directly from the decision of their employer to abolish the regional offices and not from the desire of the workers themselves."
Neil Carberry, the CBI's director for employment and skills, said: "It's now important that the Government reaches a robust and effective definition of the 'normal workplace', so that travel to infrequently-visited client sites is covered, not ordinary commutes.
"Given that this ruling extends working time, it again emphasises that the voluntary individual opt-out from working time rules is a vital part of ensuring the system works in the UK. We want to see the opt-out protected."
The ruling came about because of an ongoing legal case in Spain involving a company called Tyco, which installs security systems.
Unison general secretary Dave Prentis suggested the ruling is "bound to have a significant impact in the UK".
He said: "Tens of thousands of home care workers are not even getting the minimum wage because their employers fail to pay them for the time they spend travelling between the homes of all the people they care for.
"Now thanks to this case, they should also be paid when they are travelling to their first visit, and again back home from their last.
"Having to factor more hours into workers' timesheets will no doubt add to the pressure on employers with contracts in our public services.
"Ministers must now make plans for how this judgment is to be funded, and ensure that social care employers can no longer get away with paying illegal wages."
A Department for Business, Innovation and Skills spokesman said: "We are carefully considering the implications of this judgment."