29 Feb 2016

Ruling could mean extra holiday pay for thousands of workers

Ruling could mean extra holiday pay for thousands of workers


Thousands of workers who rely on commission look set to be able to claim more holiday pay thanks to a legal ruling.

The Employment Appeal Tribunal (EAT) has ruled in favour of a British Gas salesman, Joe Lock, who received only his basic pay while on holiday, despite making the majority of his income through commission.

It means people in similar jobs who rely on commission and non-guaranteed overtime will be able to ask for holiday pay reflecting these additional payments.

Whilst the decision is good news for workers, back-dated claims could heap significant financial pressure on businesses.

Business owners warned to prepare for claims

Sally-Anne Ogilvie, who acts for both individuals and companies in employment disputes, said that British Gas will appeal the decision.

However, she said employers should still accertain whether they may face claims, assess the extent of their exposure and decide how they are going to prepare.

"Thousands of holiday claims have already been lodged with Employment Tribunals," she said.

"However, this is by no means the end of the story in relation to holiday pay.  The British Gas case is going to be appealed.  As such, holiday pay claims are currently been placed on hold by Employment Tribunals pending the conclusion of the ongoing litigation. 

"It is hoped that as these appeals are dealt with, further guidance will also be provided by the courts as to the correct way in which non-guaranteed overtime and commission should be calculated for the purposes of holiday pay. 

"The matter is not yet settled and for employers, for now, the wait continues."

The ruling comes after a four-year legal battle by Mr Lock, who received a small basic salary plus a commission based on the number of contracts he sold. But when he took holiday, he only received the basic salary.

Get in touch

If you wish to discuss a holiday pay claim, or if you are an employer facing a claim, you can contact Sally-Anne and her team by calling 0333 0044 333 or by clicking here.

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