Holiday Pay Query

[Sarahlbx]

Hi, would someone be able to advise on this situation please and give some advice? I’m assuming the situation my partner is in with his employer is wrong, because my company pays hourly workers an average for their holidays rather than their basic hours (they do a lot of overtime).

My partner is a class 2 driver. He’s contracted to 45 hours a week at a rate of £9 per hour, plus £1 per hour attendance bonus. He earns £1 per load bonus (approx £20 / 20loads per week) plus £50 per week bonus for maintenance duties. He also works most Saturdays for 4 hours at time & half.

When my partner takes his annual leave, he is paid 9 hours at £9 per hour for each day he is off. He’s been paid like this for 5 years for every holiday and thinks it’s correct and how he should be paid for annual leave. He’s asked his office manager who’s told him that this is correct and he’s not titled to have any bonuses and overtime taken into account on the calculation of holiday pay.

my employer take all income whether it be bonus or over time into account and calculates holiday pay on this income. I can’t understand why his is just basic. His boss adds all these bonuses to bump up the hourly rate To keep the staff but really he just earns £9 an hour and is paid £9 per hour for the basic hours when on annual leave

thank you in advance

[ostell]

Is this any help?

[Sarahlbx]

Thanks.

I’ve looked at that page, his office manager has said he’s fixed hours. So that’s why they don’t have to pay him an average? This is what’s confusing us.

I work for a transport company similiar to his, all class 1 and class 2 drivers. And they are paid holiday as ‘shift workers’ according to that table

[Sarahlbx]

I’ve just found this on ACAS. So he should be paid taking his bonus and overtime into account.

if he raises a grievance in writing about this. Would he be able to claim back all the under payments from his entire employment with the company?

[ULA]

This is correct case law has confirmed that regular overtime / commissions/ bonuses paid to employees needs to be included in holiday pay calculations as related to the first 4 weeks of worker's holiday period (i.e. 20 days).

There is a limitation on how far back your husband can reclaim as follows:

• The limitation period for bringing claims for underpaid holiday is three months. This means three months from the last underpayment where there was a series of underpayments.
• The claim can only be backdated to include all deductions up to two years (from the date the claim is made), even if the underpaid dates go beyond this, provided the series is not broken.
• A series of deductions will be broken if there is a gap of three months or more between deductions. Once this happens, claims for deductions made before that gap cannot be claimed for.

[Sarahlbx]

Thank you so much.

Could you offer some advice on how to approach this with his boss?

its a smallish firm and not very reputable

i expect one he shows evidence his boss will stop the bonuses

[ULA]

I would suggest that he just arranges to meet with his boss and just have an informal chat in the first instance and see what the outcome of that is before doing anything more formal.

If you need any further help just come back to this thread.

[Sarahlbx]

Thank you for your help so far. My partner has spoken to his boss, and in a nutshell this is the development so far:-

he’s asked him not to disclose this information to his colleagues about the holiday pay

hes told him the law changed in April this year and he’s only eligible for the holiday pay back paid from April, but it’s based on an average of the first 12 weeks from April 2020

hes told him if he has to back pay him then he will have to look at changing his contract to a zero hours contract ( he’s been employed on the same contract full time for 5 years) and also stop his bonuses

[ULA]

Think your husband's employer has got that a bit backward. The reference period from 6 April 2020 for calculating holiday pay for variable hours workers increased from 12 to 52 weeks. Plus the information I gave at #5 in regard to reclaiming has not changed as far as I am aware.

Unfortunately also for your hubands boss he cannot unilaterally change his contract he would have to consult with your husband about this. Although If the employer has given reasonable and due consideration to objections and alternative suggestions that your husband put forward, but deem those suggestions to be unworkable, then the employer could terminate the original contract and offer a new one in its place such as a zero hours one.

Ultimately it "boils down" to how hard you husband wants to push this and maybe with him setting his employer right on the legal facts he may have stronger hand to at least agree a compromise and still keep his current contract.

[Sarahlbx]

Thank you.

he wants to raise this formally and put it in writing but I have no idea where to start in regards to referencing the working time directive.

i briefly spoke with my HR department and they advised the exact same as you have

[ULA]

The WTR under section 13 (2)(c) allows for leave of 4 weeks. This means that any regular payments of overtime, commisson and bonuse should be included as part of the calculation for holiday pay covering these 4 weeks. However if more holiday is given than the 4 weeks these payments do not need to be included. Link to the relevant section below

https://www.legislation.gov.uk/uksi/...lation/13/made

Hope that helps make and you can use this for your wording

[Sarahlbx]

Ula Thank you for your advice

I wrote a letter for him last night, and he was paid 2 years back pay in his wages to be paid tomorrow

[ULA]

Hopefully your husband is pleased with the outcome and I presume without any need to changing his contract going forward.