Landmark ruling on overtime and holiday pay

payrollThe Employment Appeal Tribunal has ruled that overtime should count when calculating holiday pay.  Currently, only basic pay counts when making the calculation.

The tribunal also ruled that workers can make backdated claims, but not more than three months after the last incorrect payment.

The judge did not give any directions on how holiday entitlements relating to periods of overtime were to be calculated or administered through payroll and HR systems.

There are many questions still to answer such as what exactly constitutes regular overtime and what does this mean for commission-based salaries.

A final decision on these matters could be a number of years away if the ruling is referred to the Court of Appeal.


Source:, 04/11/2014

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