The Question: By a relevant agreement between the employer and employee, can accrued holiday pay at point of termination be paid less then what would be the calculation within Working Time Regulations 1998 (WTR)?
The Answer: The Employment Appeal Tribunal (EAT) held no on the facts of the case of Connor v Chief Constable of West Yorkshire Police, where a contract term provided that on termination of employment, accrued holidays for their salaried employee would be calculated on 1/365th annual salary thus being lower than the calculation under (WTR).
The Risk / Threat: Failure to pay the correct amount of holiday pay based upon normal pay can give rise to backed holiday pay claim that could go back 2 years, but the employee must take the matter to Tribunal within three months from the last incident of breach of payment.
What you need to: Review any relevant agreements over payment of holiday at point of termination to ensure do not fall foul of the above (EAT) decision.
Call to action: If you require any further assistance, please do not hesitate to contact our HR/Legal advice line team at 0116 274 9193.
