We are delighted to announce that our private wealth law department has continued to maintain its Band 2 position in the latest edition of Chambers and Partners High Net Worth.
The Employment Appeals Tribunal (“EAT”) held in Flowers v East of England Ambulance Trust that “normal” remuneration included voluntary overtime if it was paid over a sufficient period.
It has been established in recent cases that employees are entitled to be paid “normal” remuneration for at least four weeks of their annual leave entitlement (which is the amount they are entitled to under the European Working Time Directive) and that “normal” remuneration can include payments for overtime.
There are, however, still questions around what “normal” remuneration for holiday pay, and additional pay count includes. Cases have established that it can include commission and various types of overtime, bonuses and allowances, but many are still confused about voluntary overtime. The main question, in this case, was whether “normal” remuneration includes voluntary overtime.
Various employees work for the East of England Ambulance Trust. Sometimes the employees work overtime, which could be non-guaranteed or voluntary.
Non-guaranteed overtime is essentially where a shift overruns because an employee has an obligation to complete a task (such as caring for a patient until an ambulance arrived). Voluntary overtime is where someone volunteers to work additional shifts.
The workers’ employment contracts had a clause that set out that pay would be calculated based on the amount the individual would have received had they been at work (based on the previous three months).
The Employment Tribunal (ET) initially held that holiday pay should take into account non-guaranteed overtime, but not voluntary overtime. However, after the ET’s decision, the EAT decided in Dudley Metropolitan Borough Council v Willetts that voluntary overtime came within the concept of “normal” remuneration where it extends for a sufficient period on a regular and/or recurring basis – see our previous ebriefing. The employees, therefore, appealed (and the employer cross-appealed) the ET’s decision to the EAT.
The EAT overturned the ET’s decision and held that voluntary overtime could constitute “normal” remuneration, therefore following the approach taken in Dudley Metropolitan Borough Council v Willetts. The case has been remitted to the ET to determine what holiday pay is due.
Although this case focussed on wording in an NHS contract, so may be distinguished on this basis in future cases, it is likely to be of wider application as it follows the approach taken in Dudley Metropolitan Borough Council v Willetts.
Any employers who pay overtime, whether guaranteed, non-guaranteed, compulsory or voluntary, need to consider whether they are paying appropriate amounts of holiday pay taking into account this additional pay (for at least four weeks of annual leave entitlement).
It is important to note, however, not every occasion of paid overtime will trigger an increased holiday payment. Dudley Metropolitan Borough Council v Willetts established that this would need to be where the overtime payments extend for a sufficient period on a regular and/or recurring basis. Unfortunately, in this case, the EAT did not clarify what a sufficient period would be and did not give any more detail on what a regular or recurring basis is.
How to calculate this additional pay is still, therefore, unclear. In this case, the contract of employment expressly referred to considering payments during a three-month reference period, and therefore it is likely that all payments will count. However, most contracts will not specify any period or which payments do count, and so the questions will remain – what counts as “normal” remuneration and whether the period considered should be a 12-week period (as referred to in the Working Time Regulations) or another period.
It is also worth noting that we are also awaiting the outcome of the Government’s consultation following the Taylor Review as to whether the reference period in the Working Time Regulations should increase to 52 weeks.
For more information
The decision in this case confirms that voluntary overtime that is paid over a sufficient period should be taken into account when calculating holiday pay. For more information on calculating holiday leave and/or holiday pay, please get in touch with your usual contact in our Employment Team or speak to Hazel Robbins.
Charities, like other organisations, may be subject to or choose to voluntarily comply with the reporting requirements under the Modern Slavery Act 2015.
The draft regulations making it mandatory for anyone entering a registered care home in England to have been double vaccinated unless they are clinically exempt were made on 22 July 2021.
In the Transforming Public Procurement Green Paper, the Government signalled its desire to increase its control over procurements by all contracting authorities.
The monthly round-up from the Anthony Collins Solicitors charities team.
Legal updates as the UK enters into stage 4 of the roadmap and legal restrictions on face coverings and social distancing are lifted.
The first disability we are going to discuss is diabetes. We begin by discussing the different types of diabetes; their similarities and differences and how we live with the disability within our day.
Tim Coolican and Freya Cassia explore the legal and practical options available to providers if a disappointing result is received following an inspection.
Following the launch of the CQC’s new strategy for how it regulates health and social care, many providers will be keen to know more about how the changes might affect them in the future.
EPC’s are not required to be served with a Section 21 notice for assured shorthold tenancies if the tenancy predates October 2015.
To receive invitations to our events, as well as information and articles on legal issues and sector developments that are of interest to you, please sign up to Newsroom.