Harper Trust v Brazel

Holiday Pay for Term Time Workers

Last week the Supreme Court handed down judgment in the case of Harper Trust v Brazel which itself dates back to 2017 when a term time only employee brought a claim in the Employment Tribunals for the underpayment of holiday pay.  The judgment handed down by the Supreme Court which upheld the Court of Appeal decision that part year or term time workers should not have their holiday pay prorated.

Who is affected?

This will effect companies that engage term time workers and those on zero hour’s contracts.  Section 224 Employment Rights Act 1996 sets out correct method of calculation.

Weekly pay should be calculated as an average of the most recent 12 weeks of earnings disregarding the weeks where there were zero earnings, for example holidays for term time workers.

For those businesses that engage workers on zero hours or term time contracts it would be advisable to conduct an internal audit to establish the differences between the holiday pay that workers have been paid and what they should have been paid.

Once the employer establishes the underpayment owed to the employee, how far back should the employer look? 

An unlawful deduction of wages claim can normally be brought up to a maximum of two years back pay and must be brought within three months from the last deduction.

However, there are exceptions such as the Smith v Pimlico Plumbers which in which the Court of Appeal held that the two year limit on the claim for holiday pay did not apply.

Employers affected by the decision may wish to contact their insurer once they have calculated the number of workers affected and the amount that is owed.

The question is whether to resolve the situation now or wait for workers to raise the issue.

If you are in of need employment advice or HR Support please contact Kerseys Solicitors telephone Ipswich 01473 213311 or Colchester 01206 584584 or email [email protected], alternatively Kerseys are only a click away visit our website and click “Call Me Back” and a member of our employment team will be happy to contact you at a time that is convenient to you.