Perhaps that is not really fair – Acas’ new guidance on overtime certainly does what it can to help employers on the vexed question of whether and how you take overtime into account for holiday pay purposes. However, it is held back from saying anything either new or useful because there haven’t been any developments in case law or statutory thinking in this regard which are, well, either new or useful.
It may be that this is why there remain many workforces where holidays are still paid at basic salary rate only. The law is just too uncertain, especially in light of the looming shadow of Brexit. Is this going to be one of those respects in which we “take back control of our own laws” and so side-step the issue entirely? Or is it effectively settled law in principle already, simply awaiting some judicial White Knight bearing the key to making it all work?
Acas tells us firmly that “All overtime worked should be included when calculating a worker’s statutory holiday pay entitlement”, whether voluntary or contractual, except where it is worked on a “genuinely occasional and infrequent basis”. Unfortunately there is no indication of what that means in practice, nor whether it represents a departure (or if so, a deliberate one) from the requirement in Willetts –v- Dudley MBC that overtime should be included in holiday pay if it is worked “with sufficient regularity”.
The EAT in Willetts said that this test would include (but not necessarily be limited to) circumstances where overtime is “paid for one week a month or one week in every five weeks”. So maybe you could say that if you work overtime much less than 20 to 25% of the time, it begins to become insufficiently regular, but that would surely still be too often to count as “genuinely occasional or infrequent”, so no real help there.
And none of this really-should-get-out-more analysis gets us round the underlying question of whether employees should be paid anything extra in their holiday pay for overtime which by reason of its irregularity, occasional or infrequent nature, they probably wouldn’t have worked during their holiday dates anyway.
Acas notes that many employers choose to apply the holiday pay Court decisions to the full UK 5.6 weeks’ leave rather than the EU minimum 4 weeks to which they strictly apply, because it “keeps their processes simple and understandable”. With respect, that is only true if you know what overtime you are supposed to be taking into account in the first place.
“As all Court decisions are case-specific”, ends Acas lamely, “an employer may want to take legal advice as to how these decisions will impact on their organisation”, Acas’ new strapline is the strangely familiar “Working for everyone” (whether that was cribbed from Theresa May or vice versa remains unclear), but with the best will in the world, this guidance does not yet work for employers.