Enforcing claims for statutory holiday pay

For claims made under the right to holiday pay in the Working Time Regulations (WTR) there are two legal methods of enforcing the right.


Both methods involve making a claim to an employment tribunal and so account must be taken of the need to:

  • raise a grievance with an employer
  • comply with the ACAS early conciliation process
  • pay fees for making a claim to the employment tribunal

Further information on making a claim to an employment tribunal


The third alternative is to make a claim for breach of contract.

Claims under the Working Time Regulations

The WTR has it's own enforcement provisions which allow a claim to be made to an employment tribunal within 3 months of the date on which the payment of holiday pay should have been made.


This approach does not allow the worker to recover amounts due older that 3 months.

Claims for unauthorised deductions of wages

The alternative method is to make a claim under section 23 Employment Rights Act 1996 on the basis that failure to pay holiday pay constitutes an unauthorised deduction from wages. This method has been approved in several cases including by the House of Lords in HM Revenue and Customs v Stringer (2009).

 

The advantage of adopting this approach is that claims can be made for a series of unauthorised deductions, perhaps, back to the start of the series if you have been underpaid for a long period of time - potentially back to the introduction of the WTR in 1998.

 

However the decision in the recent case of Bear Scotland v Fulton (2014) may limit the period of time claims can go back in a series of deductions. This case has decided that if there is a gap of more than 3 months between underpayments then the series is broken and the claim stops at that point. The difference in rules on payment for the 4 weeks of 'European' holiday and the additional 1.6 weeks of 'UK' holiday may be important in this situation because correct payment for the 'UK' holiday may break the series of deductions at an early point, particularly if tribunals take the line that any leave over 4 weeks is 'UK' leave.


This point is likely to be appealed so the final legal position may be different.

Claims for breach of contract

A claim for breach of contract can only be made where there is an agreement between the worker and the employer that holiday pay will be paid at a set rate. In general it will not be possible for the statutory right to holiday pay to be a term of the contract unless specific agreement to pay the amounts is reached.


A claim can only be made to an employment tribunal if the worker has left employment. Alternatively claims can be made in the small claims court regardless of the workers position.


The time limit for contractual claims is for any breach up to 6 years prior to the claim.

Need to understand a word or phrase?

Employment Law Glossary

Help us and win £10!

User survey

Thu

26

Feb

2015

Zero increases by 26%

The Office for National Statistics has released new figures that show nearly 700,000 people work on zero hours contracts - up 26% from last year.  The problems caused by these contracts will require a significant change in the law.

Read More 0 Comments