Holiday pay for term time workers
The Supreme Court has confirmed that part-year workers must receive 5.6 weeks’ statutory holiday pay following the case of Harpur Trust v Brazel.
The case decided that any worker who has a continuing contract throughout the year, but only works for certain periods during that year (such as term-time workers), must have their holiday pay calculated in the same way as colleagues who work the full year, rather than pro-rated.
The decision will affect those workers who work for part of the year under permanent or continuous contracts. This will include term-time only workers, seasonal workers, those on zero hour contracts, bank staff, and workers engaged under umbrella contracts and those businesses that rely on permanent zero hour contracted workers.
Part-year workers must receive at least 5.6 weeks of holiday each year, even if they only work for a few weeks per year. This can lead to extreme situations, as illustrated by this example when this case reached the Court of Appeal where the example of a school cricket coach working for one term was provided. Similarly invigilators, who work only during the exam season will fall under this new ruling.
The Supreme Court accepted that this put part-year workers in a more favourable position than full-time workers but said that this outcome was not so absurd to justify revising the statutory scheme.
A part-time worker will work less than the full-time equivalent (FTE) hours in a week. Therefore, the number of days’ leave a part-time worker receives will depend on the number of days (or hours) they work each week, calculated as 5.6 of their regular working weeks.
For example, if they work one day a week (0.2 of FTE), they are entitled to 5.6 days’ holiday; if they work 2.5 days a week (0.5 FTE) they will get 14 days’ holiday.
In this way, they still get 5.6 weeks’ holiday based on their contracted hours of work and will only be entitled to 28 days’ holiday if they work five days a week.
Government guidance recommends that workers who don’t have a regular working pattern or guaranteed hours should have their leave entitlement expressed in weeks rather than days.
Should you have any questions on holiday entitlement and wording in your Contract of Employment contact one of our qualfified CIPD Consultants on 0800 9995 121.