We have heard that Neal v Freightliner, one of the leading holiday pay cases,
has settled. Whilst this development may give employers some temporary respite
from the heat, the long-term forecast remains clear, holiday pay is going to
cost you more.
A spate of recent case law shows how the UK is out of line with the EU
requirements for calculating holiday pay, for more details see our previous HR
briefing ‘Where are we with holiday pay'. Although the notorious case of
Neal v Freightliner looks as though it has now settled at the last
minute, the extent to which overtime must be included in holiday pay is still a
live issue and there are plenty more cases of a similar nature waiting in the
wings. Equally, the unions will be keeping up the pressure on business to
If you have already attended our seminar - 'Holiday and Pay – the end
of the low cost holiday', you will appreciate that Neal v Freightliner
was only one part of the picture. Other cases, such as BA v Williams and
Lock v British Gas have clearly set out the direction of travel.
The various strategies discussed in the seminar and our seminar hand-out
assessing which variable pay elements count towards holiday pay remain valid.
The end of the Neal v Freightliner litigation may, however, give you a
little more breathing space to gather the information you need to make an
informed strategic decision about how to approach the holiday pay problem.
We have a meeting with government tomorrow to find out more details and their
latest thinking on potential legislative amendments and will report back.