What to include in holiday pay?

In November 2014 the Employment Appeals Tribunal (EAT) issued its decision in the cases of Wood and Others v Hertel UK and Fulton and another v Bear Scotland Ltd.


As widely expected, the decision is that, under UK law, workers must be paid normal remuneration during holidays. Normal pay is deemed to include non-guaranteed overtime, allowances and commission. Some good news is for employers is that if there is a gap of more than three months in any alleged series of deductions the industrial tribunal loses its jurisdiction to hear claims for the earlier deductions. In addition, workers are not entitled to retrospectively designate which holidays formed part of the 20 days of mandatory holiday to which this ruling applies, so it is unclear how they will establish when a deduction has been made.


It was initially unclear whether this ruling would apply in Northern Ireland. However in mid-December 2014 it was applied in the case of Robert Patterson v Castlereagh Borough Council [2014] NIIT 1793/13.Central to the issue in these proceedings was whether any period of annual leave which the claimant was entitled to should be calculated pursuant to Article 17 or Article 20 of the Employment Rights (NI) Order and whether the claimant had ‘normal working hours’. The tribunal emphasised the importance of the recent UKEAT authority of Fulton & others v Bear Scotland which clarified that ‘voluntary overtime’ which the claimant was not contractually obliged to do could not be included in the calculation of holiday pay, for the purposes of the WTR. 

In contrast, ‘compulsory overtime’ and ‘non-guaranteed overtime’ must be included in holiday pay calculation. It is vital that attention is paid to the 3 separate definitions of overtime clarified by the EAT and accepted by the tribunal in this case: 

a) ‘Non-guaranteed overtime’: where there is no obligation on the employer to provide the overtime but where the employee is obliged to work, if offered overtime.

b) ‘Voluntary overtime’: additional work which the employer asks an employee to do but which the employee is free to refuse.

c) ‘Compulsory overtime’: where the employer is contractually obliged to provide the overtime hours and the worker is contractually obliged to complete.


This is unlikely to be the end of the story as the EAT have given leave for parties in the Wood and Others v Hertel UK and Fulton and another v Bear Scotland Ltd to appeal and we expect that this is likely to occur in due course but any outcome is unlikely to be known for some time.


Even though these cases could be appealed do not ignore this issue, as it will not go away.In the meantime, we would suggest that employers and employees discuss any concerns arising from this decision with a view to seeking agreement on any temporary measures or policy changes they feel may be necessary.In order to aid preparation for such discussions, and to identify potential backdated claims, employers should carry out an analysis of their holiday pay records to determine where there are or could be 3 month gaps that could invalidate any potential claims.

Age Discrimination – £40k award

As has been reported in the local and national media, a Northern Ireland woman who claimed that Dunnes Stores discriminated against her because of her age has been awarded £40,000 in settlement, as age discrimination is protected against in the workplace ensuring equality.

The Claimant had worked as a security manager for Dunnes since 2005 and had 23 years’ experience working in security roles in various stores. After turning 60, she was placed on a series of fixed term renewable contracts with the store until 2014 (when she was 63) at which point her contract was terminated.

Crucially these fixed term contracts were not imposed on other security personnel and other managers in the company, who it was alleged were all younger than her. Ms Dunbar brought a claim against the Company and was supported in doing so by the Equality Commission for Northern Ireland who described her case as ‘raising issues about the treatment of older workers as they approach or pass what used to be regarded as retirement age’.

Although Dunnes Stores settled the claim they do not accept that they had breached equality legislation but have agreed to liaise with the Equality Commission over policies, practices, training and procedures on equality of opportunity and, in particular, on age discrimination.

Lessons of this age discrimination case

It is important to remember that equality legislation, protects employees from unlawful discrimination on the basis of age. The obvious issue in this case was that the Claimant (an older worker) was treated less favourably than other (younger) workers. The Regulations prohibit all employers, regardless of size, from subjecting job applicants and employees, including contract workers and former employees, to age discrimination and harassment.

It is unlawful for an employer to discriminate in all aspects of the employment relationship, such as:

· recruitment and selection;

· terms and conditions of employment;

· working environment (conduct and harassment);

· access to (employment related) benefits;

· termination of employment – such as dismissal and redundancy;

· post-employment situations – such as the provision of references.

Although, in the case of Dunnes Stores, the Claimant was an older worker it is important to note that the reverse circumstances (i.e. a younger worker being treated less favourably than older workers) could potentially have constituted age discrimination.

Should you require any further information in relation to the above or would like a member of the team to talk to you about a specific issue please contact us on 028 2564 4110.

Shared Parental Leave

The purpose of this bulletin is to give you an understanding of the new Shared Parental Leave (SPL) which will be available for parents of babies due on or after 5 April 2015. SPL gives working mothers the option to end their maternity / adoption pay and maternity / adoption leave early (at any point from 2 weeks after the birth/placement or 4 weeks if they work in a factory) and to share the untaken leave and pay with their partner, if they are also eligible.

Employees can take SPL in up to three separate blocks and Parents can choose how much of the SPL each of them will take but they must give at least 8 weeks’ notice of any leave they wish to take. SPL and Statutory Shared Parental Pay (ShPP) must be taken between the baby’s birth and first birthday (or within one year of adoption).


Shared Parental Leave

To qualify for SPL, the child’s mother (or adoptive parent) must be eligible for either:·

maternity leave or pay·

maternity allowance·

adoption leave or pay

Your employee must also:·

have worked for you continuously for at least 26 weeks by the end of the 15th week before the due date (or date they are matched with their adopted child)·

still be employed by you while they take SPL· give you the correct notice including a declaration that their partner meets the employment and income requirements which allow your employee to get SPL

Statutory Shared Parental Pay

Your employee can get ShPP if one of the following applies:·

they qualify for statutory maternity pay·

they qualify for statutory paternity pay and have a partner who qualifies for statutory maternity pay or maternity allowance or statutory adoption pay ShPP is paid at the rate of whichever is the lower of:·

£138.18 a week (£139.58 from 6 April 2015)· 90 per cent of the employee’s average weekly earningsOver the coming weeks you will receive a draft Shared Parental Leave Policy and Procedure which will give a more detailed insight into the procedures involved in relation to these requests.

If you have any specific queries regarding this bulletin please do not hesitate to contact one of our team on 028 2564 4110.

European Court of Justice Update

Home Blogs European Court of Justice Update

  1. Travelling to work is ‘work’, European Court rules

The European Court of Justice (ECJ) has recently held that journeys made by workers who do not have a fixed or habitual place of work must count as working time for the purposes of the Working Time Directive.In this case, brought under the controversial working time directive, two engineers who worked for a Spanish firm installing and maintaining burglar alarms appealed over how their working hours were calculated. The court agreed with the men that their travelling time between home and their first and last customers of the day should be classed as working hours.The ECJ added that, because the workers are “at the employer’s disposal” for the time of the journeys, they act under their employer’s instruction and cannot use that time freely to pursue their own interests.

So what does this all mean?

This ruling could have significant implications for those Companies that employ mobile workers who spend a lot of time travelling between appointments e.g. care workers, gas fitters and sales people.

Companies who don’t already pay mobile workers for their travel time at the start and end of the day may now face pressure to do so, and face challenges in monitoring this. If mobile employees already opt out of the maximum weekly working time (i.e. 48 hours), this decision shouldn’t mean that existing working hours have to be reduced. However, employers should ensure that mobile workers are able to take at least 11 hours’ rest between getting home at night and setting off again the following morning.

Employers who are affected by this recent decision should consider ensuring that assignments at the start and end of the day are near employees’ homes, adjusting working hours generally or asking employees to opt out of the 48-hour working week.

2. New National Minimum Wage rates

From today (1st October 2015), the new national minimum wage rates are as follows:

· adult rate will increase by 20 pence to £6.70 per hour

· the rate for 18 to 20 year olds will increase by 17 pence to £5.30 per hour

· the rate for 16 to 17 year olds will increase by 8 pence to £3.87 per hour

· the apprentice rate will increase by 57 pence to £3.30 per hour***

· the accommodation offset increases from the current £5.08 to £5.35

***This rate is for apprentices aged 16 to 18 and those aged 19 or over who are in their first year. All other apprentices are entitled to the National Minimum Wage for their age.***

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