Holiday for part-year workers not subject to pro-rata reduction

The Supreme Court decision in Harpur Trust V Brazel has reaffirmed the earlier decision by the Court of Appeal that an employer cannot pro-rata the holiday entitlement of 5.6 weeks under the Working Time Regulations 1998 for part-year workers according to the number of weeks they work in a year.

There are two central and closely related key issues decided:
I.    how should holiday entitlement be calculated for part-year workers 
II.    how should holiday pay be calculated for part-year workers.

Holiday entitlement

Workers are entitled to 5.6 weeks’ minimum statutory holiday entitlement each year, even if the worker does not work the entire year and the 5.6 weeks’ entitlement cannot be reduced pro rata for part year workers. Employers must ensure they are using the 52-week reference period method to calculate holiday pay and not using 12.07%.

Which employees does this judgment apply?

The greatest impact is on hourly paid workers, employed on a permanent contract who, for whatever reason, have a number of unpaid non-working weeks during the leave year. The greater the number of non-working weeks, the greater their holiday entitlement (and therefore holiday pay) will be as a percentage of annual working time and earnings. 

For example, organisations who engage zero-hours, term-time only or part-year workers.

Holiday pay

The pay for this holiday must now be based on the Calendar Week Method of averaging a week’s working hours (averaged over a 52-week period and using weeks where they actually worked).

Assessing the impact of the Judgement for employers

We are holding a webinar on September 12 to help take you through the judgement and its implications.

Please sign up here.

How we can help

The Stone King Group Litigation Team is currently acting for a number of Academy Trusts and dealing with group action claims issued by Trade Unions on behalf of TTO employees. 

These claims are not limited to back pay claims and include discrimination claims.

The team are also involved in group settlement and mediation discussions. 

With schools already facing financial challenges this judgement has the potential to add to additional financial hardship. 

Some insurance providers are refusing to indemnify claims and we are currently supporting a number of schools in this regard.

The team are also involved in advising and supporting clients in seeking remedy from Local Authorities for back pay.

We can also provide advice tailored HR and legal advice for your organisation's specific circumstances as required. 

The Group Litigation Team is led by Surinder Kaur Dhillon who has considerable experience in dealing with group action.

If your organisation would like further advice and support then please do not hesitate to contact the Group Litigation Team at grouplitigationteam@stoneking.co.uk