Combining Holiday Pay within the Hourly rate of pay

Posted: Thu Dec 23, 2004 1:31 pm

I thought I had red something regarding this in our own forums here but cannot find it.
I am fairly ceratin I read of a case where a tribunal found that including a workers holiday within their normal hourly rate had been contested and a ruling obtained that an employer cannot include a contribution to the workers holiday pay as part of his norma, hourly rate.

e.g an employee is quoted an hourly rate of £7.25 an hour and then finds, this comprises of a £4.85 payment for each hour of work, a payment for holiday pay (for that hour) plus an attendance allowance bringing the total hourly pay to £7.25

Forum Addict Joined: Apr 28, 2004 Posts: 122

thing about this i heard of is that anyone can say what they want so long as it is completely clear what constitues an 'hourly rate'.

ie, advertised rate is £7, but you discover this is made up of a £5 per hour rate and £2 attendance bonus.

thats not allowed.

but if its stated that you can earn 5 an hour with a 2 per hour bonus, thats ok.

Posted: Thu Dec 23, 2004 7:01 pm

I would agree with you there Spooky.
This advert was advertised on the Job Centre Plus website and they were most disturbed by the information we have passed onto them, resulting in the immediate withdrawal of not just that advert but all adverts from that client and a telephone call the them.

The Vacancy was advertised as 'Security Officer £7.25 an hour' with a very brief description of the duties.
The applicant took time of from their day job to attend 2 interviews, neither of which included an explanation of how the hourly rate was calculated.

The applicant was subsequently made a formal offer for the vacancy, which the applicant excepted.
The job description was gone over again by telephone and again, he was quoted £7.25 an hour.

The applicant had the common sense to ask for the details to also be confirmed in writing and it was only when these written particulars were received that the applicant became aware of the problem.
In the mean time the applicant had tendered his resignation and because the company still owed him holidays, it was agreed that he could serve his notice period as holidays to allow the applicant to have a Christmas period off work.

Technically, the applicant is now unemployed as his former employer has not accepted a request to resind his resignation.

I have done some more research into the legalities of rolling up holiday pay to form part of a normal hourly rate and so far have one case in which the tribunal said it was legal and a case in Scotland and one in Leds where they have said it was unlawful.
Due to the conflict, the matter has now been passed on to the European Court of Justice for a verdict.

Honorary Member Joined: May 09, 2003 Posts: 45

The 2 questions referred to the ECJ in the case of Robinson-Steele v RF Retail Services Ltd are

1. Does the Working Time Directive prevent an employer making 'rolled-up' payments to a worker that include an element of holiday pay, where no specific holidays are involved?

2. Do employers get credit for making these payments if a claim is brought against them for holiday pay within a tribunal or civil claim?

Moral of the story, get the details in writing and ask some specific questions at inteview. Contractual rights over and above the statutory ones are worth pursuing. More will be posted once the ECJ ruling is announced.

Http://www.limeone.com

Posted: Wed Dec 29, 2004 11:35 pm

Many thanks once again for your input Bob.
I have to say, I'm looking forward to the ruling just so that it clarifies the situation.
If the ECJ decides rolling up holiday pay as part of the hourly rate is unlawful, I can see a few headaches coming for some employers who have been doing this.

As far as I have been able to understand the current situation, the employees wage slip must have seperate entries for the true hourly rate paid and the amount of holiday pay paid for that particular pay period - so that is at least some comfort in that.

I just cannot help wondering when this individual would have found out the truth if he had not asked for the details in writing - probably when they eventually gave him a contract to sign or when he got his first wage slip.

I do not think there was a deliberate attempt to deceive job applicants by stating the pay rate as £7.25 an hour but I do think it was a little misleading and the Job Centres are updating their policies in respect of this to ensure a similar situation does not occur again.