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Calls For Clarity On Holiday Pay

Six months since the consultation on calculating holiday entitlement for part-year and irregular hours workers closed, the Government has yet to publish its response.

Amidst this lack of clarity, new data shows high levels of confusion among employees when it comes to holiday pay.

According to Deputy’s annual State of Shift Work report*, which surveys UK workers, more than a third (38%) of care workers are not sure about their legal entitlement for paid annual leave and many believe they could be missing out on holiday pay, according to Deputy’s global study, which surveyed 3809 shift workers, including 1166 from the UK.

The study revealed that 29% of UK care workers are not clear on the details of their legal entitlements for paid annual leave and 9% have no idea at all. Less than half (49%) were very confident that they are getting all the paid annual leave they are entitled to, with 31% less confident, 13% unsure, 4% not confident at all and 3% believing they’re not entitled to any paid leave.

Many young workers were completely unaware of their holiday pay entitlements, with 14% of Gen Z workers believing they’re not entitled to any paid annual leave.

Deputy is calling for clarity from the Government.

Jon Wilson, SVP at Deputy, said: “Our State of Shift Work report highlights the high levels of confusion that exist when it comes to holiday pay.”

The Government consultation was launched in response to the Harpur Trust v Brazel Supreme Court Judgment in July 2022. The holiday pay calculation set out by the Supreme Court was ‘average weekly pay from the previous 52 weeks, excluding weeks not worked, multiplied by 5.6 weeks’.

Jon Wilson said: “The practical implementation of this has been challenging for employers across the country, especially when calculating holiday pay for new starters and those with highly irregular hours. Businesses like ours have now built this into our technology, to automate the process for our customers, which solves the practical, administrative challenges, but the calculation has also been challenged as unfair to those with different working patterns. The purpose of the Government consultation was to address this point.

“In the meantime, some employers who might be waiting for the findings of the consultation, may not have introduced the new calculation yet. If that’s the case, their staff are missing out on their holiday pay and the employers are at risk of tribunal claims for unlawful deduction of wages. We urgently need clarity from the Government for the sake of both workers and employers.”

 

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