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Holiday Pay - Have you Read the Latest Guidance?

on Friday, 12 June 2015.

Following a number of recent court judgments, the Advisory, Conciliation and Arbitration Service (Acas) has published new guidance on calculating holiday pay.

Among other things, the guidance highlights the following points.

  • Guaranteed and normal non-guaranteed overtime should be considered when calculating a worker's statutory holiday pay entitlement, but there is currently no definitive case law that suggests voluntary overtime needs to be taken into account.
  • Commission should be factored into statutory holiday pay calculations.
  • Work-related travel may need to be factored into statutory holiday pay calculations.
  • A worker's entitlement to holiday pay will continue to accrue during sick leave.
  • There are different rules for calculating holiday pay depending on the working patterns involved.
  • Workers must take their statutory paid annual leave allowance and can only be 'paid in lieu' for this when their employment ends.

In addition, the guidance confirms the introduction of a two-year limit for claiming backdated deductions from wages, including holiday pay. This is expected to apply to any claim presented on or after 1 July 2015.

Best Practice

Whilst the guidance does not say anything new, it is a useful summary of the current obligations in relation to holiday pay.

For more information, please contact Jo Oliver in our Employment Law team on 0117 314 5361.