NORMAL PAY FOR HOLIDAYS

Important Holiday Pay Claims Update - 3 months ruling

12 November 2014: On 4th November 2014 the Employment Appeal Tribunal decided 3 test cases on holiday pay claims.

The judge confirmed that regular additional payments such as overtime should be included in the calculation of holiday pay. The ruling only applies to holiday pay guaranteed under the Working Time Directive which covers the first 20 days of annual leave each year.

This means that going forward employers will have to work out what an employee has actually earned and reflect this in pay when the employee takes annual leave.
The judgement also contained a surprise ruling that significantly restricts the ability to claim back pay for previous underpaid annual leave.

Any claim for unpaid wages has to be made within 3 months of the underpayment. Claims can be made for a series of underpayments, but only if there is less than 3 months between underpayments.

The EAT decision may be appealed but for now any underpayments must be linked by gaps of less than 3 months in order to form a series for back pay claims.

Example 1
The employee has 30 days annual leave.

Holidays are taken in February 2014, April 2014 and August 2014 totalling 20 days. Payment is made at the end of each month. The underpayment in August is in time if a claim is made before the end of November 2014. However, the underpayment in April is more than 3 months before the underpayment in August, so no claim can be made for earlier underpaid holidays for this employee.

If the employee makes a claim for the August 2014 underpayment, any new underpayments in 2015 could be added to that claim.

Example 2
The employee has 30 days annual leave.

Holidays are taken in February 2014, April 2014 and July 2014 totalling 20 days and payment is made at the end of each month. The holiday payments are all within 3 months of each other but the last payment at the end of July 2014 is more than 3 months ago, so no claim can be made by this employee.

If there is a new underpayment in 2015, the employee can make a claim within 3 months.

As the examples show, each claim will depend on when each individual has taken their annual leave.

Members who consider that they have a claim should complete a Holiday Pay CASE form without delay.

The branch should forward Holiday Pay CASE forms to the Regional offices on the day they are received.

Thompsons Solicitors will then be instructed to assess the cases and will put claims into the Employment Tribunal were appropriate.

Thompsons Solicitors will write to members explaining the position in relation to their individual claim.

If branches have not done so already, they should lodge collective grievances in relation to underpayment of holiday pay for affected members.

Thompsons have been instructed to work closely with regional and branch officers in relation to ongoing local negotiations.

Any collective settlement proposals should be referred to Suzanne Craig, Legal Officer for advice.

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Holiday Pay Claims Important Update

1 November 2014: Since our earlier briefings on holiday pay claims, a number of employers have attempted to limit their liability for back pay by including additional money for holiday pay in workers’ pay.

This triggers the time limit for claims with the effect that many claims may go out of time. Where this has been done by a large employer like a local authority, you will already have received advice from UNISON.

If your pay now includes an element of additional pay, the time for bringing a claim will have started from the date on which you were last underpaid holiday pay. If there are more than three months since the last time holiday pay did not include additional sums, then you will be unable to pursue a claim.

The branch will be sending out a more detailed briefing very soon, but you should contact us now if you think you are running out of time because your employer has made additional payments for past underpaid holidays.

CLICK HERE for a special case form to be filled in for 'Normal Pay for Holidays' claims. (Form version amended 1 Sept because some members reported they could not open it)

25/08/14: Letter to members and special case form

19/08/14 Update on Holiday Pay following 'Lock' case judgement in European Court of Justice

17/07/14: Normal Pay for Holidays brieifing

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25/08/14 To all members

Dear colleague

URGENT 'NORMAL PAY FOR HOLIDAY' CLAIMS

As we have previously informed you, on 22 May 2014, UNISON member Joe Lock was successful in his claim, Lock v British Gas. The Court of Justice of the European Union (CJEU) found that a worker’s annual leave pay should include commission payments if these were part of normal pay.  The Employment Tribunal will decide how UK law will now be interpreted in light of this decision. It is likely that whatever decision is reached by the Employment Tribunal will be appealed through the higher courts, so it may be a long time before any payments are received.

As a result, the Council has now changed the way it calculates holiday pay with effect from the beginning of the financial year, 1 April 2014.

The change will only apply to employees who claim monthly earnings in addition to base pay by submitting a claim form (for example, for casual overtime). It does not apply to any additional payments that are non-claims based (for example shift payments) as these are already included in the calculation of holiday pay.

We have been informed that employees affected by this change will receive an increased payment in respect of holiday pay, amounting to 8.3% of the additional earnings claimed each month. This will be shown as an additional earnings element on their AUGUST payslip. 

PLEASE CHECK YOUR WAGE SLIP NOW!

If you see any of the two entries as outlined below PLEASE CONTACT THE BRANCH OFFICE IMMEDIATELY FOR A CLAIMS FORM OR DOWNLOAD A COPY OF THE FORM FROM THE FOLLOWING LINK: http://www.unison-edinburgh.org.uk/holidaypay/HolidayPay
AbbreviatedCASEFormTIMEBAR(3).doc AS YOU MAY HAVE A CLAIM:-

- Holiday Pen (if pensionable)
- Holiday NPen (if non-pensionable)

CLAIMS MUST BE MADE WITHIN 3 MONTHS OF THE LAST UNDERPAID HOLIDAY PAY

Please note, the Lock decision only covers the minimum period of annual leave guaranteed by the Working Time Directive (i.e. 20 days) and does not cover additional contractual annual leave.

 

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19 August 2014: Update on Holiday Pay following 'Lock' case judgement in European Court of Justice - UNISON Scotland site.

What to do if you think you might have a claim

• Contact your local branch as soon as possible. They will be able to keep you up-to-date on your employer’s response and on UNISON’s claim strategy.

• Ensure your contact details are up-to-date. The easiest and quickest means of contact is through email. Click here to update your details

• Contact the branch immediately if your employer stops making the payments for commission, other supplements, bonuses or over-time pay; or if your employer starts paying any unpaid commission, other supplements, bonuses or overtime pay during annual leave.

1 August 2014

Branch briefing (pdf)

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17 July 2014: A decision by the European Court of Justice could mean employees who normally get paid enhancements like overtime, shifts and commission - but not when they are on holiday - might be able to make a claim for back money.

It is not clear how many members may be affected (Edinburgh Council has stated that all employees regularly receiving working time payments like shift allowance also get those in with their holiday pay). However the Branch is writing to all the all of the employers where we have members in the following terms:-

"NORMAL PAY FOR HOLIDAY CLAIMS

On 22 May 2014, UNISON member Joe Lock was successful in his claim, Lock v British Gas. The Court of Justice of the European Union (CJEU) found that a worker’s 20 days statutory annual leave pay should include commission payments if these were part of normal pay.

The Employment Tribunal will decide how UK law will now be interpreted in light of this decision.

Can you please confirm if your organisation pays staff additional payments during their annual leave periods, and if it does not, what will be done to rectify this?

How have you calculated those who worked overtime or additional hours and included that in their holiday pay?"

In the meantime, any member who believes they may have a claim should email the UNISON office with your details to branchoffice@unison-edinburgh.org.uk

You can also phone 0131 558 7488 but it is better for us to have emailed details from you so that there are no misunderstandings.

More information on STUC site.