01332 340 211

Holiday pay – voluntary overtime

Find a person by name
Or choose a department

 

Hooray, the summer has finally arrived (for the moment at least), and lots of employees are jetting off to enjoy their summer holidays. It seems the Tribunals still have holidays and holiday pay on the brain too…

Whilst, employees are off sunning themselves in some tropical paradise, employers are left with the somewhat tricky task of trying to figure out exactly what they need to pay these employees whilst they’re off.

Holiday pay – what’s in and what’s out?

As you will no doubt know, there have been some MASSIVE changes surrounding holiday pay over the past year or so… Click here to read my original holiday pay update for the lowdown.

It’s no longer a case of simply paying the employee their standard wage for the time they are off.

Now, employers should be looking to pay an employee’s ‘normal remuneration’ whilst they are on holiday. This can include compulsory and non-guaranteed overtime and commission. This is to make sure that an employee doesn’t ‘miss out’ financially whilst they are on holiday.

We can see the idea behind it – employees shouldn’t be put off from taking their holiday through fear that they will not earn the same as if they were at work… BUT, equally, employers need to know exactly what they need to include in the calculation!

Another change?

Yes, you heard us correctly, there may now be yet another (potential) addition into what should be included when calculating holiday pay.

This time it’s the turn of voluntary overtime i.e. overtime that an employer does not have to provide and the employee doesn’t have to work.

A very recent case, heard in the Court of Appeal in Northern Ireland, said that voluntary overtime MAY need to be included when calculating holiday pay.

So, what’s next?

The Court of Appeal did not give any guidance about when voluntary overtime should or should not be included in the calculation. Instead they said that each case should be looked at on a case by case basis. I’m sure you’ll agree that this is not the most helpful guidance ever!

This case is going to go back to the Employment Tribunal for them to have another look at it. So, we have got to wait and see what happens… For now, it’s safe to say don’t automatically discard voluntary overtime; it may need introducing in your holiday pay calculation.

And so, the holiday pay saga rumbles on. we are sure that this certainly won’t be the last that we hear about holiday pay…

If you would like any further advice on this topic or any other aspect of employment law, please do contact the team.

< Back
All News >
SEE MORE

Contact us

x

Name (required)

Phone Number (required)

Your Email (required)

Subject

Message

Derby Head Office:
St. Michael’s Court
St. Michael’s Lane
Derby
DE1 3HQ
Tel: 01332 340 211
Fax: 01332 207 601
DX: 729320 Derby 24

Ashbourne:
54, St. John Street
Ashbourne
Derbyshire
DE6 1GH
Tel: 01335 342 208
Fax: 01335 342 010
DX: 26834 Ashbourne

Opening Times:
Our offices are open Monday to
Friday between 8:00am & 6:00pm

Contact us

x