New Holiday Pay Rules

Monday, January 11, 2016

New Rules on Holiday Pay Entitlement.

Workers could soon be entitled to holiday pay accrual on overtime payments according to an employment tribunal.

Currently, payments such as Bonus and Overtime do not attract holiday pay in the same way that 'regular' hours do. The rationale behind this is that, a salaried worker, with a fixed Holiday Entitlement, would not be entitled to additional days if they worked overtime. However, Temporary Workers' hours are increasingly being classified as 'Overtime' due to the flexible nature of temporary contracts.

Claims for back dated holiday pay could run into "billions" and there is a real danger that some firms will not survive, leading to probable job losses, especially in the manufacturing sector.

Because of the complex nature of the ruling, it is likely that an appeal process could take many years to complete.

For more information on Holiday Entitlement visit our Holiday Pay Explained page.