Calculating holiday pay (updated 2017)
Holiday pay must now include payments for regular overtime and contractual results-based commission.
Updated to look at October 2016’s Court of Appeal decision in Lock vs British Gas and we look at October’s 2014 Employment Appeal Tribunal (EAT) decision that says overtime should be included when calculating holiday pay (the combined cases of Bear Scotland vs Fulton, Hertel vs Wood and Others, and Amec vs Law).
And details of the EAT’s confirmation in White v Dudley Council in August 2017 that voluntary overtime, voluntary standby and voluntary on-call allowances that are ‘normal’ remuneration and paid over a sufficient period of time and on a regular basis should be included in holiday pay calculations too.
Calculating the amount of pay an employee should receive when on holiday used to be fairly straightforward, with the exception of the interaction between holiday and sick pay. However, recent decisions have made the calculation a lot more complicated. We look at all the details here and what this means for Employers and Employees (and Workers).
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