Holiday Pay Could Be Changing

Holiday pay could be changing: if your employees work overtime on a regular basis it is likely this will have to be factored into holiday pay calculations.

This is because of a legal case brought by Ambulance drivers and upheld by the Court of appeal last month.

Where your employees work overtime on a ‘sufficiently regular and settled basis’ it may not be enough to continue paying them holiday pay at their contracted hours.  There is still a chance that the Supreme court could overturn the decision but its unlikely and would take a significant period of time to reach this point. There’s a chance that the Supreme Court could overturn this decision. But it’s unlikely—and would take a long time, too. 

Employees must get at least 5.6 weeks under current legislation but in a further complication the new ruling only applies to the first 4 weeks of annual leave. 

No guidance has been issued on what constitutes a ‘sufficiently regular and settled basis’ so employers will have to take a decision on that and hope they don’t get it wrong.

For advice on payroll or how the new law affects you please call EM Cubed Ltd on 01555 890935.