04 December 2014 #Employment
UNITE, which represents the claimants in the Hertel (UK) Ltd v Woods and others UKEAT/0160/14 and AMEC Group Ltd v Law and others UKEAT/0161/14 cases, has announced that it will not be appealing the EAT's decision. The indications are that the employers in these cases will not be appealing either. This means that the legal position in relation to overtime and holiday pay, in light of these cases, looks like that it is settled for the time being, meaning that in most cases it will not be possible for workers to claim underpaid holiday pay going back many years, as feared.
The EAT decided that non-guaranteed overtime must be taken into account in calculating statutory holiday pay derived from the Working Time Directive, but limited the extent to which workers can make retrospective claims for underpaid holiday. Workers will not be able to bring claims based on a series of deductions, where there has been a gap of more than three months between the deductions. Explaining its decision, a Unite spokesperson said: "We don't want to bankrupt business; going forward it is about ensuring employees are paid their fair share and working with employers to ensure they get their house in order."
UNITE was not involved in Bear Scotland Ltd v Fulton and another UKEATS/0047/13, which was heard together with Hertel and AMEC. However, that case has been remitted to the employment tribunal and the parties were not granted permission to appeal.
This does not mean, however, that the argument over historic holiday pay is definitely completely over. There is the prospect of there being further appeals in future cases coming before employment tribunals. The feeling is that such appeals should be anticipated and are almost inevitable.
One major uncertain issue coming out of the recent cases is to what extent should voluntary overtime be included in the calculation of holiday pay. This issue is left unaddressed by the recent appeals. It seems quite likely, however, that when the issue comes before employment tribunals, if there is evidence that voluntary overtime is regularly worked, tribunals will include it when calculating overtime. Employers should therefore consider making provision for it. It is very likely then that there will be an appeal case on the issue before long, which hopefully will provide some clarification.