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Tuesday, 4 November 2014

Taskforce to assess judgment in holiday pay ruling

Business Secretary Vince Cable has today announced he is setting up a taskforce to assess the possible impact of the ruling on holiday pay from the Employment Appeal Tribunal. The taskforce will consist of a selection of Government departments and business representative groups. The taskforce will provide a forum to discuss how the impact on business can be limited. 

Business Secretary Vince Cable said: "Government will review the judgment in detail as a matter of urgency. To properly understand the financial exposure employers face, we have set up a taskforce of representatives from Government and business to discuss how we can limit the impact on business. The group will convene shortly to discuss the judgment. “Employers and workers can also contact the ACAS helpline for free and confidential advice.”

In today’s judgment the UK Employment Appeal Tribunal decided that holiday pay should reflect non-guaranteed overtime. John Cridland, CBI Director-General, said: “This is a real blow to UK businesses now facing the prospect of punitive costs potentially running into billions of pounds – and not all will survive, which could mean significant job losses. These cases are creating major uncertainty for businesses and impacting on investment and resourcing decisions. This judgment must be challenged. We need the UK Government to step up its defence of the current UK law, and use its powers to limit any retrospective liability that firms may face.”

Also commenting on the ruling TUC General Secretary Frances O'Grady said: “Failing to count overtime when calculating holiday pay is quite simply wrong. This ruling marks a victory for people who work long and hard to make a living, and who deserve to be properly paid when they take their well-earned leave. “Scaremongering about the possible impact of this ruling is irresponsible. British business is far more robust than some of its spokespeople would admit. It's worth remembering that in 1999 a change in the law meant that six million people gained more holiday entitlements, and businesses easily absorbed the increase and employment continued to rise."

Margot Parker MEP, UKIP's Small Business spokesman: “Today’s ruling from the Employment Tribunal is simply outrageous. Thousands of companies could be hit with retrospective claims, some dating as far back as 1998, that would cripple them and put them out of business. It cannot be right that businesses that acted in good faith could now be subject to massive payouts that may well bankrupt them, putting many people out of work. The European Working Time Directive is a wolf in sheep’s clothing for thousands of businesses up and down the country. It may look like a good thing for workers, but the reality is that it hits the small and medium sized enterprises that are the backbone of our economy, hard. The gold plating of it by our institutions is abominable."