It’s that time of year when our thoughts generally turn to getting away on our summer holidays and enjoying lazy days jam packed with – well, not much really other than chilling (literally and metaphorically if heading for even hotter parts of the world). And with holidays at the top of all our agendas, isn’t it just immaculate timing that holiday pay is grabbing employment law headlines once again?
Just when we thought we knew where we stood with calculating pay for annual leave, and the associated risks and remedies of getting it wrong, the Court of Appeal in Northern Ireland has thrown a spanner in the works in the recent case of Chief Constable of Northern Ireland Police v Agnew. The court ruled that the EAT's decision in Bear Scotland Ltd v Fulton, that a gap of three months breaks a series of unlawful deductions, was wrongly decided.
In the Bear Scotland Ltd case, the EAT judged that when an employer has not calculated holiday pay correctly, the payment of correct holiday pay would break the series of deductions. Since annual leave is considered to be taken in order of EU leave entitlement first, followed by UK leave and then contractual leave, this would limit the chain of deductions (and therefore back pay) often to just the most recent leave year.
The Court of Appeal case has been remitted back to the tribunal to consider the correct level of compensation, which could run into tens of millions of pounds as there is no law in Northern Ireland that limits back pay to two years (as there is in England, Scotland, and Wales), and claims could go back over 20 years.
The English, Scottish and Welsh tribunals are not obliged to follow judgments by the NI Court of Appeal, but the judgment may well prove very persuasive as the EAT's decision in the Bear Scotland Ltd case has been widely criticised.
We will be discussing the Court of Appeal’s decision and all the associated background law, on the Autumn Law on Tour, along with other really important cases. We’ll also be tackling lots of those ‘oh so tricky’ subjects, such as Brexit; how to manage employees with poor health who are under-performing; sabbaticals and secondments; unfair dismissal and the range of reasonable responses; making deductions for overpayments; continuity of employment; calculating termination dates; how to leave a fair audit trail in investigations; and collective consultations.
We start the tour in Leeds on 1 October, so you don’t have to worry about missing out as it’s well after the holiday season is over. Although I can’t promise the same of the holiday pay confusion!
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