04 November, 2014
An Employment Expert at Forbes Solicitors is warning that today's ruling in relation to overtime and holiday pay will prove costly for employers.
The Employment Appeal Tribunal has ruled that voluntary overtime should be taken into account when holiday pay is being calculated. Whilst full details are yet to be revealed, the decision will have significant implications for businesses.
Peter Byrne, Partner at Forbes Solicitors comments, "What is clear now is that the cost to businesses is likely to increase significantly. It is not yet known how the holiday pay is to be calculated and in some circumstances historical claims could be backdated as far back as 1998 when the Working Time Regulations were introduced. Fortunately for employers, this will only be possible in a very small number of cases. Employers who regularly pay overtime should change their working practices and seek advice immediately."
It is anticipated that the decision will be the subject of a further appeal, so it may be some time before a final outcome with true certainty is known.