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Holiday pay and commission: Judgment delivered in Lock v British Gas

UNISON has today (25 March) reported via Twitter that the much anticipated judgment in the Lock v British Gas Trading Limited case has been delivered by the Leicester Employment Tribunal.

Calculating holiday payAn extract from the reserved judgment hit Twitter feeds this morning. The brief extract from the judgment confirms that additional wording must be read into the Working Time Regulations 1998 (WTR) to bring the calculation of a week’s pay in line with the Working Time Directive.

As such, the WTR are to be interpreted as if the following paragraph were added to it:

“…a worker with normal working hours whose remuneration includes commission or similar payment shall be deemed to have remuneration which varies with the amount of work done for the purposes of section 221.”

 

The Court of Justice of the European Union (CJEU) had previously concluded that commission must be factored in when calculating holiday pay (see our previous blog ‘Holiday pay and commission a quick recap’). The judgment from the Employment Tribunal released today very much confirms that employers will need to account for commission when calculating holiday pay for workers going forward.

We are yet to see the full judgment to review the issues that were not addressed by the CJEU, including the key question of the principles to be adopted when calculating the sum payable to a worker to recompense him for commission he might have earned if he had not been on holiday. A full analysis will follow once more detail is released.

For more information about holiday pay issues visit our holiday pay hub.

Questions about holiday pay? Get in touch

Keep up to date and follow us: @DWF_Employment

 

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Legal news, views, trends and tools for HR Professionals. Stay ahead. Go further