Holiday pay dispute resulted in a constructive dismissal

An ACAS helpline adviser who had “no option but to resign” after nine years of disputes over holiday pay miscalculations, was unfairly dismissed, a tribunal has ruled. It was found that ACAS was “in fundamental breach of the implied term of trust and confidence” due to persistent failures to calculate the correct amount of paid holiday for the employee and because of their failure to investigate complaints within a reasonable period.

The adviser had been employed on a series of fixed term contracts and her holiday entitlement was calculated in hours. The employee did not sign and return her original contract as she had queries relating to the way the holiday entitlement had been calculated.

After years of her raising queries, the employer started using a new software system to administer holidays and absences but it failed to maintain any record relating to the claimant which resulted in her trying to manually calculate them, backdating them to 2013 when her first contract was issued.

Over several years, the claimant consistently disputed her holiday calculation and eventually ACAS stated that she was owed 124.32 hours leave and that her ongoing leave was 133.64 hours per year. However, this was not put in writing, despite the employee requesting this. There had been various personnel changes throughout this time and the employee was anxious that she did not have a written record of her dispute having been agreed and resolved.

She eventually resigned and raised a grievance during her notice period. The payroll department dealt with the matter and found that holiday pay had been miscalculated from the beginning of the employment and the employee was actually owed £9625.67. At the employment tribunal the employee was awarded additional compensation of £24,847.58 as a result of a fundamental breach of the implied term of trust and confidence because the employer created and then allowed the dispute to continue up to the date of the final resignation. The tribunal acknowledged that the ongoing situation exposed the employee to uncertainty and stress and had a negative impact on her health.

This is another example of an employee dispute being allowed to continue without resolution, resulting in a much more serious outcome for the employer. If you are concerned about an ongoing employee dispute, contact us on 0800 9995 121.

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