Butlins will have to hand out as much as £1m in back pay to staff after a court ruled deductions for gas and electricity they used when living on holiday sites was illegal.
Up to 6,000 mainly seasonal workers will share the payout as a result of a court of appeal judgment against the holiday camp firm. The workers were charged £6 a fortnight towards the cost of electricity if they lived on site, taking their salaries below the minimum wage.
The case was bought by HM Revenue and Customs, with the support of the GMB union. It began at an employment tribunal two years ago before progressing to an appeals tribunal and then to the Court of Appeal.
In his judgment, Lord Justice Buxton said: “The workers are seasonal staff employed as bar staff, shop assistants, receptionists, security staff and, in some cases, electricians and plumbers in various parts of the country.
“If the sum of £3 per week were to be deducted from their wages, that would reduce remuneration below the national minimum wage level.”
A spokesman for Butlins and Haven Holidays said it believed the ruling only affected a few hundred former workers, most of whom had already been tracked down.
The company was “carefully considering the implications of the ruling”, he added.