Shorter Reads

Worker entitled to backdated holiday pay

1 minute read

Published 1 December 2017

Share

Key information

Two of the hottest topics in employment law recently have been worker status and holiday pay.

There have been cases on whether Uber drivers, and others working in the “gig economy”, should be treated as workers rather than self-employed contractors, and therefore be entitled to benefits including holiday pay.  And there has also been a series of cases about how holiday pay should be calculated, and that it should include elements such as commission as well as basic salary.

These two topics have come together in an important decision from the European Court of Justice.  Mr King worked for The Sash Window Workshop and was engaged (by his own choice) as a self-employed contractor.  As such he did not get paid holiday.  However, after he left the company, he brought a claim in respect of holiday pay that he says he should have received.

The UK Employment Tribunal held that Mr King was in fact a worker rather than self-employed.  Therefore he should have been entitled to paid holiday.  Normally, employees have to take holiday in the relevant holiday year, or lose it, so a claim would be limited.  But in this case, the ECJ held that Mr King should be entitled to claim backdated holiday pay not just for the previous holiday year, but stretching right back to when he started working for the company.  This meant that the liability added up to a very considerable sum.

The case will now be sent back to the UK Court of Appeal, but it is likely that it will follow this decision from the ECJ.

Companies that use a lot of self-employed contractors need to be aware that this status is being subject to scrutiny more and more often.  The potential bill for making the wrong decision on worker status is set to become a lot more expensive.

Sash Windows decision leaves employers wide open to holiday pay claims

Related latest updates
PREV NEXT

Arrow Back to Insights

Shorter Reads

Worker entitled to backdated holiday pay

Published 1 December 2017

Associated sectors / services

  • Dispute Resolution
  • Employment law for employers

Two of the hottest topics in employment law recently have been worker status and holiday pay.

There have been cases on whether Uber drivers, and others working in the “gig economy”, should be treated as workers rather than self-employed contractors, and therefore be entitled to benefits including holiday pay.  And there has also been a series of cases about how holiday pay should be calculated, and that it should include elements such as commission as well as basic salary.

These two topics have come together in an important decision from the European Court of Justice.  Mr King worked for The Sash Window Workshop and was engaged (by his own choice) as a self-employed contractor.  As such he did not get paid holiday.  However, after he left the company, he brought a claim in respect of holiday pay that he says he should have received.

The UK Employment Tribunal held that Mr King was in fact a worker rather than self-employed.  Therefore he should have been entitled to paid holiday.  Normally, employees have to take holiday in the relevant holiday year, or lose it, so a claim would be limited.  But in this case, the ECJ held that Mr King should be entitled to claim backdated holiday pay not just for the previous holiday year, but stretching right back to when he started working for the company.  This meant that the liability added up to a very considerable sum.

The case will now be sent back to the UK Court of Appeal, but it is likely that it will follow this decision from the ECJ.

Companies that use a lot of self-employed contractors need to be aware that this status is being subject to scrutiny more and more often.  The potential bill for making the wrong decision on worker status is set to become a lot more expensive.

Sash Windows decision leaves employers wide open to holiday pay claims

Associated sectors / services

  • Dispute Resolution
  • Employment law for employers

Need some more information? Make an enquiry below.

    Subscribe

    Please add your details and your areas of interest below

    Specialist sectors:

    Legal services:

    Other information:

    Jurisdictions of interest to you (other than UK):



    Enjoy reading our articles? why not subscribe to notifications so you’ll never miss one?

    Subscribe to our articles

    Message us on WhatsApp (calling not available)

    Please note that Collyer Bristow provides this service during office hours for general information and enquiries only and that no legal or other professional advice will be provided over the WhatsApp platform. Please also note that if you choose to use this platform your personal data is likely to be processed outside the UK and EEA, including in the US. Appropriate legal or other professional opinion should be taken before taking or omitting to take any action in respect of any specific problem. Collyer Bristow LLP accepts no liability for any loss or damage which may arise from reliance on information provided. All information will be deleted immediately upon completion of a conversation.

    I accept Close

    Close
    Scroll up

    Find out about Business

    Find out about Dispute Resolution

    Find out about Individuals & Families

    Find out about Real Estate

    We are Collyer Bristow - The law firm for those that
    value individuality, creativity and collaboration.

    Legal & Pricing info Regulatory InformationAccessibilitySitemapPricing and service information

    Listen to our latest podcast: No notice, no claim? (Drax v Scottish Power)

    Read our latest article: Election 2024: Domicile, Inheritance Tax, and change promised by the new Labour government

    Watch our latest video: What is a nuptial agreement? A full guide to everything you need to know about pre and post nups

    Read our latest article: Election 2024: Initial comments on potential tax changes

    Read our latest article: Labour wins UK general election: What changes are coming for employers?

    ExpandNeed some help?Toggle

    < Back to menu

    I have an issue and need your help

    Scroll to see our A-Z list of expertise

    Get in touch

    Get in touch using our form below.



      Business Close
      Private Wealth Close
      Hot Topics Close