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Pay ruling worry for employers.

I WRITE with reference to this week's landmark ruling on backdated holiday pay and its potential to open the way for retrospective holiday pay claims.

The judgement means that overtime, shift payments, unsociable hours, payments and travelling time payments that are currently excluded from holiday pay could be included in it.

While the change to the law could be tied up in the UK's courts for years to come, and it might lead to the regulations on holiday pay being amended, it is telling that some of the UK's bigger business names have begun to prepare for payouts.

This measure will take money away from businesses that is now needed for investment to take businesses to the next level and help them with growth. While being a potential windfall to many workers, the consequences of the ruling could be extremely damaging to employers.

Small and medium-sized businesses will quite rightly be worried about the cost of extra holiday pay. However, the judgment indicated that claims for retrospective holiday pay would be likely to be too late and couldn't be heard.

So, for the period before the judgment, which might have gone back as far as to 1998 for people in the same employment - the year when Brussels put paid holiday into law - it would only go back three months.

However, the extra costs could very sadly mean that some smaller businesses are pushed to breaking point and beyond.

Employers should now be reviewing their contracts with a view to how payments are worked out and to prepare for the eventuality of claims for revised holiday pay.

NEIL ATKINSON, managing director, Deminos HR

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Publication:Evening Chronicle (Newcastle, England)
Date:Nov 10, 2014
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