Holiday pay – the saga continues
10th October, 2016
On Friday (7 October), the Court of Appeal handed down its decision on the long running case of Lock v British Gas.
What did the Court say?
The Court ruled that holiday pay must include results-based commission that the worker would have earned if at work.
What does this mean for me?
This decision confirms the previous ruling of the Employment Appeal Tribunal that, the Working Time Regulations should be tweaked in order to accommodate the Working Time Directive, which requires that a worker receives ‘normal remuneration’ in their holiday pay.
It must be noted that this probably isn’t the end of the road for this issue.
Firstly, the Court did not rule on how to calculate such payments. Secondly, there is also the possibility that British Gas appeal the decision to the Supreme Court which will lead to further uncertainty for employers until an ultimate determination is reached in the Autumn of 2017, at the earliest.
This latest decision and rulings such as Bear Scotland v Fulton, which held that overtime should also be included in the calculation for holiday pay, highlight the current direction that is being taken with holiday pay by the tribunals and courts.
Therefore, it wouldn’t be surprising if this ruling only serves to intensify calls from businesses for changes to be made to the Working Time Regulations post Brexit.
How can Ward Hadaway help?
For further information on holiday pay and how recent rulings could affect your organisation, please get in touch.
Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.
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