Are you sick of speculation about where the wheel will stop spinning on holiday pay? Just want to be given a safe position and stick with it? Do you have any commission or overtime claims against you stayed by the Tribunal pending a definitive steer from case law or legislators? Steps to provide some clarity may be on the horizon at last. Following the news of British Gas’ decision to appeal against the Employment Tribunal’s decision in Lock Holiday Pay in the UK, many employers assumed that the Employment Tribunals would simply continue to stay those cases already filed to allow the appeal to run its course. What would be the point of deciding cases where the fundamental principles on which they are based are still being resolved in the higher courts? However, whilst this is generally the approach being taken north of the border, the English ET system appears to be managing things differently. In relation to cases dealing only with the impact of overtime earnings on holiday pay, it is now listing cases for preliminary hearings, at which the stays are being recalled and a set of orders issued. Whilst those Orders vary to some extent between the different Regional Offices, in essence they seem to require:

  • the claimants to provide further particulars of their cases (e.g. which holiday days are being claimed for, when they were taken, when they were paid, and what elements of pay were not included that should have been).  The idea of this is to begin to flush out the claims that are clearly out of time or where there is a clear 3 month break;
  • the claimants to create a schedule of this detail based upon the pay-slips and holiday records in their possession, and send this to the respondent lawyers within c.6 weeks; and
  • the employer to verify this data and populate any areas of the schedule where information is missing, within 6 weeks of receipt. The employer also has the opportunity at the same time to provide an updated response, e.g. elaborating on and providing substance to any arguments that the claims are out of time or where there is a clear 3 month break in the series of deductions or where it contends that there was no loss of earnings caused by the holiday absence.

The English Tribunals are then listing a further preliminary hearing during the Autumn to enable the parties to update the Tribunal regarding the progress made and to decide on next steps, by which time (we hope!), it will at least be clearer when the appeal in Lock will be heard.   It is likely that this will not be the last preliminary hearing since there are bound to be further arguments as to reference periods, proof of loss and (maybe most problematic of all) a retrospective determination of which of those days claimed for was the Working Time Directive minimum and which is the Working Time Regulations or contractual excess over that. That question affects both the size of the claim and the 3 month break question and in the great majority of cases there will be no evidence at all to assist. Watch this space! Although at first sight, the lifting of the stays may seem premature, there is actually some benefit to it. For example, it may allow the parties to get a clearer idea of the potential liability, without involving a significant amount of work for the employer in preparing for a full hearing. It may be that in some cases both sides will recognise that the work this requires is disproportionate to the amount at stake and choose instead to reach the resolution between them that Acas recommends. The only downside could be where a claimant does not have the information the Tribunal has asked him to provide – in which case it is inevitably the employer which will have to “fill the gaps”. The other key driver for the Tribunals’ decision appears to be the desire to proactively manage these cases over a period of time rather than face an immediate colossal backlog once the outcome of Lock is known. Bearing that in mind, it seems likely that a further stay will be granted once these initial case management Orders have been complied with. Squire Patton Boggs has a Holiday Pay Task Force comprising experts from each of UK offices. If you have any questions relating to holiday pay or need help with any current or pending claims, please contact:

Charles Frost, Birmingham –

David Whincup, London –

Andrew Stones, Leeds –

Alison Treliving, Manchester –