Holiday Pay for Term-Time Workers
5th June 2018Back to articles
A part-time music teacher who worked on a zero-hours contract mostly during term-time has had her claim for unlawful deduction from wages upheld by the Employment Appeal Tribunal (EAT) on the ground that calculating her holiday pay on a pro-rata basis capped at a rate of 12.07 per cent of her annualised hours could not be justified and overlooked the overriding principle that part-time workers are not to be treated less favourably than full-time workers (Brazel v The Harpur Trust).
The music teacher's contract entitled her to paid statutory leave of 5.6 weeks a year, remunerated on a pro-rata basis depending on the number of hours worked. This was paid three times a year at 12.07 per cent of the accrued hours at the end of each term.
The percentage used was arrived at because 5.6 weeks is equivalent to 12.07 per cent of the working hours available in a year.
The 5.6 weeks' holiday were not included in the calculation because a worker cannot accrue hours of work during that period. She argued that her holiday pay should be calculated according to the method set out in Section 224 of the Employment Rights Act 1996 (ERA), which is based on a person's average pay over the previous 12 weeks worked. Use of this method would result in a higher figure.
The school year varies, being between 32 and 35 weeks long. The woman's employer argued that the calculation it had used was in accordance with guidance provided by the Advisory, Conciliation and Arbitration Service and to calculate the holiday pay of workers in her position in accordance with Section 224 of the ERA – i.e. based on average earnings over the 12-week period immediately before leave is taken and ignoring weeks outside term time – would unfairly reward those who work fewer weeks than the standard 46.4 weeks in a working year.
The Employment Tribunal (ET) found that the teacher had not been subjected to an unlawful deduction from wages.
In its view, a principle of pro-rating was appropriate and this could be achieved either by reading words into the Working Time Regulations 1998 so as to apply a 12.07 per cent cap of annualised hours where part-timers work fewer than 46.4 weeks a year or by pro-rating the worker's entitlement to 5.6 weeks' pay.
The EAT disagreed. In its view, there is no requirement to carry out an exercise in pro-rating for part-time workers in order to ensure that full-time employees are not treated less favourably or to avoid a 'windfall' for term-time-only workers. The fact that the application of Section 224 ERA produces such anomalies could not justify the ET's conclusions.
The purpose of the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 is to ensure that part-time workers are not treated less favourably than full-time workers. There is, as yet, no principle to the opposite effect. The case was remitted to the same ET for calculation of the sums due to the claimant.
For information and advice contact Caroline Mitchell or Maxine Nutting in Devizes on 01380 722311.