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.
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.
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.
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
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
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
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
25/08/14 To all members
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.
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
• Ensure your contact details are up-to-date.
The easiest and quickest means of contact is through
email. Click here to update
• 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
1 August 2014
Branch briefing (pdf)
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
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
"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
In the meantime, any member who believes
they may have a claim should email the UNISON office
with your details to email@example.com
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.
information on STUC site.