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Holiday pay for term-time only employees and workers

This case will have implications for schools and academy trusts.

The Claimant was a term-time only employee, whose holiday pay was calculated on a pro-rata basis to that of full-time employees, which is common practice across the education sector and used by some local authorities.

She argued that her holiday pay should have been calculated using her average earnings over a 12 week period (the Calendar Method). From April 2020, this period is now 52 weeks.

Her complaint was initially dismissed by the employment tribunal. However, the EAT, the Court of Appeal and the Supreme Court all found that her holiday pay had been miscalculated. The Calendar Week was the correct implication of the Working Time Regulations. This means that no account shall be taken of a week in which no remuneration was paid, so the employer should have gone back more than 12 weeks to ascertain the correct average salary.

It was irrelevant if this meant that she received more than part-time workers who worked the whole year.

The Government has now launched a consultation to address this issue, details of which are under our employment law changes section.



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