Holiday Pay Update

David McRae
Managing Director
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In our update 204 we explained that the Employment Appeal Tribunal (EAT) dismissed the appeal of British Gas in the well-publicised Lock case.

British Gas appealed to the Court of Appeal, and it has now been announced that their appeal was unsuccessful. The Court upheld the previous decisions of the EAT and Employment Tribunal, finding that Mr Lock’s holiday pay must include an element of the sales commission he normally earned while working.

The Court declined to consider the position of workers in other circumstances, such as those who receive results-based annual bonuses.

This decision is not surprising and reinforces the now clear line of authority that employees’ normal earnings must be maintained by the employer during periods of holiday, whether that be in relation to bonuses, commission, overtime or allowances.

The story of the Lock case may not be over quite yet, however, as British Gas has sought leave to appeal to the Supreme Court. It is therefore possible that all of the UK Employment Tribunal claims being held in abeyance pending a definitive decision in the Lock case may not move forward for some time yet.

Just Employment Law will report on further developments as and when they happen. In the meantime, you can read the Court of Appeal’s judgment here:

http://www.oldsquare.co.uk/images/uploads/news-and-media/British_Gas_v_Lock_judgment_COA.pdf

Topics: Court Of Appeal, Holiday Pay