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Employment Appeal Tribunal Says UK Has Not Been Calculating Holiday Pay Correctly

British MoneyEveryone always wants more money for less work, and it appears that some people may get it. Under European Union law, all workers are entitled to at least four weeks of holiday pay a year. Because this rule doesn’t stipulate how the time should be calculated, it has been miscalculated in the United Kingdom.

Until recently, the U.K. government has been interpreting this rule, the European Union Working Time Directive, as employees receive their basic rate of pay while on holiday. They do not receive, however, additional payments from regular overtime or other work time. As a result, most employees haven’t been including regular overtime hours when they figure up their holiday pay.

A new ruling from the Employment Appeal Tribunal suggests that the U.K. government has been doing this wrong. According to reports, the Tribunal has already ruled three cases in favour of the employees. The three companies that were hit by this new ruling were Amec, Bear Scotland and Hertel.

According to reports, the staff members at these three companies work overtime on a consistent basis. When they leave for holiday, however, they don’t receive payment for this overtime work. All they receive is their base pay.

It is hard to say for sure who will be affected by this new ruling. However, the government currently estimates that around 30.8 million people in the United Kingdom get paid for overtime work. These figures are only based on data received from the Office for National Statistics on work that people did between June and August 2014. Thus, these figures cannot be used as an accurate measurement because there is no way to tell if these people work overtime on a regular basis.

That is where the problem is. How can people tell if they work overtime on an regular basis? Does that mean that they work overtime every week? Every month? No one is for sure yet just how to calculate this, or if the ruling will end up favouring the companies more than the employees.

Howard Beckett, the executive director for the Unite union, said that this new decision isn’t going to open up a huge floodgate of past claims. Instead, it will change things for workers moving forward, giving employees the money that they would have received as normal wages during their period of rest. This is their normal pay, not just their base pay.

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