The long-running saga of holiday pay may be coming to an end.
We have discussed these cases on various blogs and newsletters over the last couple of years. Both the European Court of Justice and the Employment Appeal Tribunal service have ruled in favour of Mr Lock, a commission-earning British Gas employee who questioned holiday pay and how it was calculated.
The ruling will affect thousands who earn bonus and commission payments. This is different from the holiday pay ruling in
Whilst taking annual leave, he was unable to earn commission and therefore received only his basic salary. This limits an employee’s ability to take holiday, especially for longer periods when they depend on the commission payments to pay the bills.
The employment tribunal referred the case to the European Court of Justice to rule whether the UK are required to reflect results based on commission in its rules for calculating holiday pay. The European Court of Justice concluded that because Mr Lock’s commission was directly linked to the work he carried out,
The Employment Appeal Tribunals decision will influence the outcome of other pending holiday
This will cause a headache for sales based companies, particularly around sales and commission schemes. We suggest you review these and ensure they are updated with this latest ruling. I appreciate as an employer you may think why should you pay
If you need any support to review existing arrangements, please get in touch.