The Supreme Court will decide if workers who only work part of the year should receive the same holiday entitlement as workers who work all year round
Key Contact: Claire Knowles
Author: Daniel Evans
In the case of The Harpur Trust v Brazel, the Court of Appeal held that workers who are engaged under a permanent contract but only work part of the year should be entitled to the same 5.6 weeks holiday entitlement as workers who work throughout the whole year. The effect of this decision is that part-year workers will receive proportionately higher holiday entitlement than an individual who works all year round.
The claimant, Ms Brazel, is a part time music teacher who worked during term time and did not work every week. She was engaged on a zero hours contract and she was paid her holiday at the end of each term. Her holiday pay was calculated in accordance with ACAS guidance, by multiplying the pay she had received by 12.07%.
The Courts’ Decisions
The Employment Tribunal (ET) originally held that words should be read into the holiday pay calculation that applied the 12.07% multiplier calculation to prevent full-time workers being treated less favourably than part-time workers. This was overturned on appeal. The ET had overlooked that the law provides that part-time workers should not be treated less favourably than full-time workers. There is no law to the opposite effect.
The Court of Appeal held that the Working Time Regulations (WTR) do not provide for the 12.07% type of pro rata calculation for the workers it defined as ‘part year workers ‘. It held all part year workers holiday pay should be calculated by calculating a week’s pay in accordance with the Employment Rights Act 1996 and multiplying a week’s pay by 5.6.
The Supreme Court will now have the final say on the matter. The appeal was heard in November 2020 and the decision is expected to be announced soon. The Court of Appeal’s decision is currently binding and so workers are within their right to issue unlawful deduction of wages claim if the wrong calculation is currently being applied.
While we wait for the Supreme Court’s decision it is essential businesses consider what workers they have that are impacted by this decision and quantify the potential liability the business may face. If the business has workers who work term time, or only part of the year, and it is still applying the 12.07% multiplier, it could likely be subjected to an unlawful deduction of wages claim. If you require any support or want further advice on this matter, please contact our Employment Team.