Backdated Holiday Pay
In the case of The Sash Window Workshop and another v King, the European Court of Justice ruled that anyone deemed to have “worker” status must be able to carry over paid annual leave even if they have not had the opportunity to take this. The judgement made it clear that Sash Window Workshops’ ignorance on King’s employment status was no defence to not paying his holiday pay.
Following the above case, employers in a similar situation faced significant financial liability over unpaid annual leave claims that could be backdated as far back as 13 years, as the ruling suggested.
However, the above may not be the case as recently a Pimlico Plumber worker, Gary Smith, lost his claim for £74,000 in backdated holiday pay.
Gary Smith was an Engineer at Pimlico Plumber and was claiming for backdated holiday pay going back to 2005 following a Supreme Court ruling against Pimlico Plumber which held that he was a ‘worker’ as opposed to self-employed and thus was deemed to be entitled to other employment rights such as holiday pay and sick pay.
However, the Croydon employment tribunal ruled that Gary Smith hadn’t filed his claim for backdated holiday pay quickly enough as the tribunal rules required Gary Smith to have claimed missed holiday pay within three months following each holiday period from 2005.
The decision is subject to an appeal, but this case highlights the importance of issuing tribunal proceedings with in the right time frame.
Besides, this recent Pimlico Plumber case overturns the previous decisions made in relation to backdated holiday pay claims, (as seen in Sash Window Workshop and another v King) and this may hinder other individuals who are also considering making backdated holiday pay claims with similar status. On the other hand, with all the recent gig economy cases, this will not stop other self-employed contractors from challenging their legal status. Therefore, it is important for employers to seek advice if they are unsure on what constitutes worker status.
Please call the Quest employment advice line if you have any questions.
