Neal v Freightliner Ltd ET/1315342/2012

Clarification has recently been received from the Employment Tribunal in relation to how to calculate a worker’s pay while on holiday. 

Workers are entitled to 5.6 weeks’ paid holiday a year. If a worker is working regular hours then this is a fairly straightforward calculation. The difficulty comes if the worker’s hours are not stable. This is because the Employment Tribunal has found that an employer should take a worker’s overtime payments into account when calculating their holiday pay. This means an employer needs to calculate what the worker is entitled to under their contract of employment and also calculate and incorporate any non-guaranteed, voluntary overtime. 

This potentially means that a worker could recover several years of underpayments as a breach of contract claim. However, remember that Employment Tribunal claims currently incur an issue and hearing fee. In the majority of cases it is therefore unlikely to be proportionate for a worker to bring a claim for holiday pay alone. In addition the decision is in the process of being appealed to the Employment Appeal Tribunal.

Katie Stephenson is a Solicitor in the Employment Department at BHW Solicitors in Leicester. Katie can be contacted on 0116 281 6227.

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