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TEAM News

Part-Year Workers and Holiday Pay Takes Centre Stage in Harper Trust v Brazel [2019]

In Harpur Trust v Brazel [2019], the Court of Appeal (CoA) considered whether the holiday entitlement of part-year workers on permanent contracts should be pro-rated to that of full-year workers to reflect the fact that they do not work throughout the year.

The CoA held that an Employment Tribunal (ET) was wrong to read words into Regulation 16 of the Working Time Regulations 1998 (WTR) to the effect that part-year workers should have their annual leave entitlement capped at 12.07% of annualised hours.

By way of background, Ms Brazel was a clarinet and saxophone teacher, employed on a zero-hours contract at Bedford Girls School, with her working hours dependent on the number of pupils requiring her tutelage during term time but typically ranged between 10 to 15 hours a week.

In March 2015, Brazel made a claim to the ET for unlawful deduction from her wages by underpayment of her entitlement to holiday pay. This followed a change in casual and term-time employees’ annual leave allowance at the Harpur Trust, which stipulated that these individuals should receive an annual leave allowance of 12.07%. This was calculated using the 5.6 weeks’ holiday entitlement stated on staff members’ employment contract, divided by 46.4 weeks. Brazel, who works 32 weeks, was informed that she was therefore entitled to 3.86 weeks of annual leave, with each day paid at 12.07% of her salary.

Brazel argued that she lost out with this method of calculation, as it produced a lower figure than that required by the rules in the WTR. She believed that holiday pay should be calculated by taking the average weekly remuneration for the 12 weeks prior to the calculation date and multiplying it by 5.6. She calculated that this would give her holiday pay of around 17.5 percent of her earnings for the term.

The ET dismissed Brazel’s claim, citing that Brazel’s calculation would award her with proportionately the same holiday pay entitlement as a full-year employee.

Following this ruling, the CoA explored whether Brazel should receive less than her holiday entitlement, to reflect the fact that she does not work throughout the year. The CoA, however, rejected the ET’s decision, finding that the WTR do not enable pro-rating in this fashion. The CoA held that the WTR makes no provision for pro-rating, instead they require the exercise of identifying a week's pay in accordance with the rules set out in the Employment Rights Act, and multiplying that figure by 5.6 weeks. Attempting to build in a pro-rating requirement would not be in accordance with the scheme designed by the WTR.

In handing down the CoA’s judgment, LJ Underhill coined the term “part-year worker” to describe somebody on a permanent employment contract who only worked for part of the week for part of the year and said their holiday pay should be calculated differently to part-time staff who worked the full year, even if it resulted in the employee receiving a windfall.

This bulletin is for general guidance only and should not be used for any other purpose. It does not constitute, and should not be relied upon as legal advice.

JMW Solicitors is a Limited Liability Partnership.