Holiday Pay - Pushing the Legal Boundaries

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Holiday Pay Pushing the Legal Boundaries By: Adam Willoughby On: 24 th November 2015 @ 13:00 FREE WEBINAR Starting Soon

Transcript of Holiday Pay - Pushing the Legal Boundaries

Page 1: Holiday Pay - Pushing the Legal Boundaries

Holiday Pay – Pushing the Legal Boundaries By: Adam Willoughby On: 24th November 2015 @ 13:00

FREE WEBINAR

Starting Soon

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Housekeeping

“Please use the chat box for questions, thoughts

and Debate”

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Applicant Tracking System (ATS)

Careers websites

Recruitment Support

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Improve recruitment communications Promote your employer brand Reduce the costs of recruitment Tighter control on recruitment decisions Manage the ROI of recruitment Attract better quality people, faster

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Sun, Sea, and a Series of Deductions Adam Willoughby

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Content

• Review of the statutory provisions

• Domestic interpretation

• Williams & Lock

• Bear Scotland

• Poking the Bear

• The future

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The Starting Point

• Article 7 – Working Time Directive

• Rationale – Health & Safety

• Working Time Regulations 1998, Regs 13 and 13A

• “Euro Leave” – 4 weeks’ leave

• “Domestic Leave” – 1.6 weeks’ leave

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Paid Leave

• The right to paid leave

• WTR, Reg 16

• Right to a “weeks’ pay” (not defined by Art 7)

• Defined by reference to Employment Rights Act 1996, ss.221-224

• What all the fuss is about

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Weeks’ Pay – Concept of Normal Working Hours

• Normal working hours? (s.234 ERA 1996)

• No normal working hours = averaging method

• Normal working hours – is there a variation in remuneration owing to when work is done or how much work is done?

• Variation = use an average

• No variation = what is payable under the contract

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The Domestic Position (pre-Williams/Lock/Bear)

• Overtime not normal working hours unless required by contract

• OVERTIME • Bamsey [2004] EWCA Civ 359

• Employer not obliged to offer o/t

• CA = o/t did not counT

• COMMISSION • Evans v. Malley Orgn [2002] EWCA Civ 1834

• Commission such that remuneration did not vary with amount of work done

• Did not count

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Williams v British Airways

• Civil Aviation (Working Time) Regulations 2004 • Holiday pay specified but no calculation • Disapplies ERA

• Should receive “normal remuneration”

• “comparable to periods of work”

• “to all the components intrinsically linked to the performance of the tasks which he is required to carry out under his contract of employment and in respect of which a monetary amount, included in the calculation of his total remuneration, is provided and, second, to all the elements relating to his personal and professional status as an airline pilot”

• Problem with Williams

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Lock v. British Gas

• Is the pay “intrinsically linked”? – is the payment directly linked to the performance of tasks required to be carried out under the contract?

• Commission, in that case, met that test

• Does not matter that commission paid during employee’s holiday – opportunity to earn affected

• “...remuneration must be maintained and that, in other words, workers must receive their normal remuneration for that period of rest”.

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Run up to Bear

• Neal v Freightliner • Voluntary overtime

• Interest

• Conjoined appeals

• Core Question: Does Article 7 require overtime be taken into account when calculating holiday pay?

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Implications of Bear

• Non-guaranteed, compulsory overtime should be taken into account

• Guaranteed/non-guaranteed overtime which is voluntary (employee can refuse) not expressly dealt with

• Indications in respect of purely voluntary overtime

• Fitting with Bamsey

• read the following words into regulation 16(3)(d) WTR: “(d) as if the references to section 227 and 228 did not apply and, in the case of the entitlement under regulation 13, sections 223(3) and 234 do not apply”.

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Implications of Bear

• Regulation 13/13A difference

• Enforcement under WTR

• Enforcement under ERA

• What is a “series of deductions”

• There must be: • A sufficient similarity of subject matter such that each event is

factually linked with the next in the same way as it is linked with its predecessor; and

• A sufficient frequency of repetition.

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Limitation

• 3 month limitation period – a policy driven ruling

• How far back can one claim if the series is unbroken? • 1998

• 6 years

• Deduction from Wages (Limitation) Regulations 2014

• inserts into the ERA two new sub-sections into section 23. The intended effect is to limit claims to two years ending with the date that the claim is presented.

• The amendment applies to “any fee, bonus, commission, holiday pay or other emolument referable to his employment, whether payable under his contract or otherwise.”

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The Future

• What has not been considered? • Series/limitation

• Truly voluntary overtime

• Interest

• Lock 8-9th December • commission and non-guaranteed overtime are dealt with under

different provisions and use different language, and the employment tribunal incorrectly concluded that Bear Scotland, a case about overtime, has any bearing on the outcome of Lock; and

• in any event, the EAT in Bear Scotland incorrectly concluded that UK domestic legislation can be interpreted purposively to give effect to EU law.

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Interim Measures

• EASYJET

• Audits

• Do not sit back and do nothing – clear direction of travel

• Be aware of group litigation claims • Cost effective

• Slow

• Little choice – policy established at local level by REJs

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Questions?

Adam Willoughby

Broadway House

Chambers [email protected]

0113 246 2600