Millions due backdated holiday pay

4 November 2014

uk-money.jpg A legal ruling could be making around 5 million people a little wealthier thanks to the potential for being eligible for a load of backdated holiday!

The employment appeal tribunal have ruled that employers must include overtime when they're calculating their staffs' holiday pay. This could see payouts for up to a sixth of the UK’s 30 million workers, which is absolutely mental.

However, some companies are worried that the size of the bill could put them out of business, but there'll be a good number of people who think that they should've thought of that before now.

The Employment Appeal Tribunal ruled on two cases relating to the UK’s understanding of the Working Time Directive, including one involving electricians, scaffolders, and semi-skilled operatives who worked on a project at a power station in Nottinghamshire. Union, Unite, said that these employees consistently worked overtime, but that wasn't included in their holiday pay, meaning that, the money they got was "considerably less" than their normal pay.

Howard Beckett from Unite, said: "Up until now some workers who are required to do overtime have been penalised for taking the time off they are entitled to. This ruling not only secures justice for our members who were short changed, but means employers have got to get their house in order."

"Employers will now have to include overtime in calculating holiday pay, and those that don’t should be under no illusion that Unite will fight to ensure that our members receive their full entitlement."

Unsurprisingly, the businesses themselves aren't too happy. Mike Cherry, policy chairman of the Federation of Small Businesses, said: “The government must bring in emergency legislation to prevent the backdated claims. [If they don’t act] hundreds of businesses will shut down and that will lead to thousands of employees being laid off."

"Business has done everything it could to comply with the law at the time and now to have it changed is totally wrong. Our members are very clear about this – it could have severe implications."

The Government actually support the employers and don't want to see these payments being made. A spokesperson said: "We understand the deep concern felt by many employers and have intervened in the employment appeal tribunal cases to make our views clear."

So what's the way out of this tricky situation? Is backdated holiday pay any good to you if your job is going to vanish along with it? Depends on how much money is being offered per person. Either way, there's going to be some arguments about this.

TOPICS:   Banking


  • Rob
    Another ridiculous ruling fron europe The same people who think you're entitled to a £600 refund on a £9.99 flight which was delayed 3 hours.. Is all well and good bringing in these daft rulings but Business / jobs will ultimately suffer
  • Jeeps
    "the money they got was “considerably less” than their normal pay" Apart from they were probably on double time anyway for the overtime. Does anyone really expect to get more holiday time because they work some overtime?
  • Slacker
    "Apart from they were probably on double time anyway for the overtime." You'd be surprised how many employers - retailers in particular - employ people on part time contracts and compulsory overtime with the specific intent of saving money on holiday pay. As for the 'business will suffer' cobblers, we had all that scaremongering over the minimum wage and the world didn't end. Maybe you'd be happier paying people £2/hour Rob?

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