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UK HR E-briefing: Holiday pay uncertainty ended in employees’ favour

  • United Kingdom
  • Employment law - HR E-Brief
  • Employment litigation and dispute resolution - HR e-briefs


The Supreme Court yesterday refused British Gas permission to appeal in the holiday pay case of Lock: the Working Time Regulations are properly to be read purposively to give effect to the CJEU ruling in Lock.

Crucially, we now know that representative results-based commission and non-guaranteed overtime (i.e. overtime which workers are contractually obligated to perform) must be included in the calculation of holiday pay for the first 4 weeks of holiday under the Working Time Regulations. Furthermore, this is a right which is applicable now.

However, the position with respect to truly voluntary overtime (i.e. overtime which workers are not contractually obligated to perform) remains unclear. Although there are a number of first instance ET decisions which do suggest that truly voluntary overtime should be included, there is no binding UK authority on the point.


As the UK leaves the EU, the government will in theory be able to change the law so that it does not comply with EU requirements. However, with Theresa May having already confirmed that workers’ rights will not be diminished under a future Tory government as a result of the UK’s exit from the EU, it is likely to be the case that workers will, into the future, be entitled to expect pay for the first 4 weeks of annual leave not to diminish as a result of holiday having been taken.

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