Today, the Supreme Court released the historic PSNI v Agnew judgment. The case relates to police officers who claimed they had been historically underpaid whilst taking holiday. The crux of the issue decided was: how far back a holiday pay claim can be made?
What was the existing law?
Previously the law relied on the case of Bear Scotland, which created a three month chaining system – employers would look back within the previous three months and ‘stepping stone’ between holiday underpayments. If there was a larger than three month gap then the chain was broken, limiting employer liability
How does the new ruling change this position?
The new ruling removes the three month chaining; how far back a claim can be made is a question of fact, based on the cases circumstances. For example, in this case, Agnew, the common error of paying only the basic rate whilst on annual leave linked the underpayments together; creating a chain stretching back to 1998.
I am a Northern Irish employer, what does this mean?
This means that if common factual circumstances create the appropriate linking, similar to Agnew, there could be a liability for claims back to 1998.
I am an employer in Great Britain, does this affect me?
The case affects Great Britain the same way, however a piece of legislation absent from Northern Ireland places a two year limit on claims.
Will holiday law change again?
Potentially. The government consultation on holiday pay completed earlier this year, with a result due soon. It is only a consultation, and an election looms next year (limiting time to legislate), but the law could change in response to the results.
How can we help?
We have holiday pay webinars on the Academy here: Accelerate your learning | SD Worx Academy
We also run a consultancy service with expertise knowledge in holiday pay law – if you have any holiday pay concerns, please get in touch:
