Holiday pay and part-time workers increasing hours
The question was whether, where a part-time worker increases their hours, the employer is obliged to recalculate the entitlement to annual leave retrospectively even taking into account annual leave already accrued and taken. The ECJ held that it was not.
The Claimant’s working hours and days varied from week to week and she took 7 days paid leave at a time when she was working 1 day a week, so the equivalent of 7 weeks’ leave entitlement. The employer took the view that she had exhausted her entitlement. She then increased her hours to 12 days on and 2 days off per fortnight. When her employment ended she claimed a payment for accrued untaken annual leave. Her claim was upheld by the Employment Tribunal but the matter was referred to the ECJ following an appeal and an application for reconsideration.
The ECJ held that annual leave must be calculated according to the workers’ contractual working pattern and the hours and days actually worked. However the taking of leave which accumulated in one period is unconnected to the working hours in the later period where the leave is actually taken. There is already authority that a reduction from full to part-time working should not result in a reduction in the amount of leave a worker has already accumulated. Employers have to therefore distinguish between different periods of different working patterns and calculate the leave which accumulates in each period separately. This approach should be adopted whether this is during the employment or after it has ended.
This legal update is provided for general information purposes only and should not be applied to specific circumstances without prior consultation with us.
For further details on any of the issues covered in this update please contact Gemma Ospedale, Partner in Employment on 020 7583 2222.