Lawyer warns firms to look at their holiday pay policies.
MERSEYSIDE businesses must review holiday pay policies or risk legal action in the wake of a significant employment law ruling, a Liverpool law firm has warned.
DTM Legal, which has offices in Liverpool and Chester, is urging companies to stay one step ahead of developing case law by ensuring that holiday pay calculations take employee overtime into account.
DTM Legal's warning comes as case law continues to develop.
The issue centres on the principle that employees should not lose out on "normal remuneration" when taking holidays because this would act as a deterrent to taking a break, which is a health and safety requirement.
In November 2014, a landmark Employment Appeal Tribunal ruling found that non-guaranteed overtime (overtime which does not contractually have to be offered by the employer but must be done by the employee if offered) had to be included for the purposes of calculating holiday pay.
Tom Evans, associate in DTM's employment and HR team, said: "There are a number of options open to employers and we are advising our clients to consider them and to take action."
Tom Evans of DTM Legal