The Department for Work and Pensions has only just introduced a mechanism to incorporate regular overtime into holiday pay, several years after a landmark judgment concerning how holiday pay should be calculated.
According to the Public and Commercial Services Union (PCS), the DWP has announced that it now has a system in place to allow this to be paid, and will compensate members for a period of up to two years for holiday pay they should have received as a result of working overtime.
The DWP is“also exploring whether it is in a position to backdate payments beyond two years”, the union said.
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A statement from PCS said: “PCS welcomes the fact that the DWP is finally attempting to remedy a long-standing injustice. However, we are absolutely clear that in the midst of a cost of living crisis members should have all the money that they are entitled to from their employer.
“We will continue to strive for justice for all of those members who are entitled to holiday pay resulting from regular overtime work all the way back to the time of the 2017 ruling.”
It said that “the department needs to comply with the law and make arrangements for both the ongoing payment of holiday pay accrued by the working of overtime and to address the backdating of payments to when the ruling was introduced”.
“PCS has brought a successful employment tribunal claim against the DWP who were forced to pay the successful member two years’ worth of accrued holiday pay as a result regularly working of overtime,” the union said.
In 2017, in Flowers and others v East of England Ambulance Service NHS Trust, ambulance workers claimed that two types of overtime – “non-guaranteed” overtime taken when their shifts overrun and any voluntary shifts they choose to take in advance – should be included in holiday pay calculations. This was upheld by the Employment Appeal Tribunal and the Court of Appeal.
Another case in 2014, Bear Scotland v Fulton, saw a tribunal rule that the Working Time Regulations 1998 are to be interpreted so that payments for overtime, which a worker is required to work, must be included in the holiday pay calculation, even where that employer did not guarantee that overtime.
Last month the government announced plans to simplify how holiday pay is calculated, following the UK’s withdrawal from the EU.
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A DWP spokesperson said: “We are pleased to have developed a digital solution with our payroll provider that enables us to include relevant overtime payments in holiday pay calculations. We have informed staff that those eligible will receive their payments as soon as possible.”
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