Voluntary overtime should now be included in holiday pay.

As we hope you are aware from our previous posts and newsletters covering this subject, compulsory overtime must be included when calculating holiday pay.

We’ve long thought that voluntary overtime would be next on the agenda…

..and so it is

An Employment Appeal Tribunal has recently confirmed that voluntary overtime pay that is sufficiently regular to be considered “normal pay” must be included when calculating holiday pay. In addition, out of hours standby payments and call-out allowances should also be included.

This is a binding decision by the courts, however it is advised that each case must be decided on its own merits as to whether the situation does constitute voluntary overtime that is sufficiently regular to need to be taken into account when calculating holiday pay.

So a case of “work it out for yourself but woe betide you get it wrong” once more in the world of employment law we’re afraid!

Contact us if you think this might affect your business and we can help work it out.

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