Previously holiday pay was calculated on a week’s basic pay, but following two rulings last year all this has now changed.
Initially it was decided that employees, who were expected and paid to do additional overtime hours, had to have included in their holiday pay the overtime and additional regular payments such as on call allowances.
A claim for commission to be included as well then followed, and now the Court of Justice of the European Union (CJEU) has ruled that where an employee’s pay includes an element of commission, that commission must be taken into account when calculating their holiday pay.
It is still down to the UK courts to implement some decisions, however the judgements that now need to be considered when calculating an employees’ holiday pay can be found in full in the Acas Holiday Pay Guidance.
By Mike Hyde