Car Allowance & Accrued Holiday

Car Allowance & Accrued Holiday

Author
Discussion

Tyrant

Original Poster:

663 posts

229 months

Tuesday 21st July 2015
quotequote all
Hi All,

I've moved on from a job where I was paid car allowance, a lump sum in addition to my salary to cover car purchase and costs, excluding fuel. I accrued some holiday, which has been paid, however they have not included for the car allowance in that payment. Had I taken the holiday prior to leaving I would have been paid the allowance over that period.

Can anyone advise what should be paid as part of accrued holiday?

Thanks

Edited by Tyrant on Tuesday 21st July 17:16

Vee

3,094 posts

233 months

Wednesday 22nd July 2015
quotequote all
Your official leaving date is at the END of your holiday, therefore you're an employee until then.
I'd expect the car allowance to be paid until then as well.

Edited by Vee on Wednesday 22 July 12:44

anothernameitist

1,500 posts

134 months

Wednesday 22nd July 2015
quotequote all
^ as above

Tyrant

Original Poster:

663 posts

229 months

Wednesday 22nd July 2015
quotequote all
Thanks, had I taken the holiday rather than receive an accrued holiday payment it would have been paid, so particularly unfair not to!

Edited by Tyrant on Wednesday 22 July 15:49

Vee

3,094 posts

233 months

Wednesday 22nd July 2015
quotequote all
Sorry, I misread or misunderstood.
You didn't take the holiday, you got paid it. Therefore your leave date was earlier and your car allowance is only due up to that point imo.

Tyrant

Original Poster:

663 posts

229 months

Wednesday 22nd July 2015
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Ok, appreciate the input. I called ACAS as to me it seems unreasonable not to pay it. They were of the opinion it should be paid unless the contract specifies that it won't be.

jkh112

21,886 posts

157 months

Friday 24th July 2015
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You were paid for the accrued holiday because you did not take it. Had you taken it you would still have finished on the same date but would not have received the extra holiday money. If this is correct then you did not lose any car money as it was paid until your end date which would have been the same regardless of whether you took the holiday as time or cash.

Tyrant

Original Poster:

663 posts

229 months

Friday 24th July 2015
quotequote all
jkh112 said:
You were paid for the accrued holiday because you did not take it. Had you taken it you would still have finished on the same date but would not have received the extra holiday money. If this is correct then you did not lose any car money as it was paid until your end date which would have been the same regardless of whether you took the holiday as time or cash.
Had I taken the holiday I would have received car allowance for the period I was not in work (as was the case with earlier holidays taken). Recieving the payment in lieu just deferred taking a holiday from within the notice period to just after (and between jobs). I have lost out by working a sensible handover period by my logic. I should have taken the holiday finishing earlier, subsequently started the new job earlier and been better off by a few hundred quids car allowance.

Countdown

39,688 posts

195 months

Friday 24th July 2015
quotequote all
Vee said:
Sorry, I misread or misunderstood.
You didn't take the holiday, you got paid it. Therefore your leave date was earlier and your car allowance is only due up to that point imo.
That's my understanding as well.

Tyrant

Original Poster:

663 posts

229 months

Friday 24th July 2015
quotequote all
Is there anything specific that could confirm that?
I'll make sure I take the holiday if in that position againscratchchin

Sheepshanks

32,522 posts

118 months

Friday 24th July 2015
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Tyrant said:
I'll make sure I take the holiday if in that position againscratchchin
You'd work a bit less but you'd be worse off financially if you'd taken the holiday. The way you've done it now you've got some additional money for unused holiday.

Countdown

39,688 posts

195 months

Friday 24th July 2015
quotequote all
Tyrant said:
Is there anything specific that could confirm that?
I'll make sure I take the holiday if in that position againscratchchin
Sorry, nothing official. I just know it from the way our payroll system operates. Holiday pay / PILON is calculated pro rata based on your annual salary . Car allowance is calculated based on days worked.

To put it another way - any overtime payments or annual bonuses wouldn't be uplifted to take into account car allowance.

Having said that, this CAN vary from company to company and the deciding factor will be based on company custom and practice.

Tyrant

Original Poster:

663 posts

229 months

Saturday 25th July 2015
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Sheepshanks said:
You'd work a bit less but you'd be worse off financially if you'd taken the holiday. The way you've done it now you've got some additional money for unused holiday.
I desperately needed that holiday laugh I took the same amount of time off between jobs, leaving me worse off financially than if I'd taken the leave during my notice period (starting the new job earlier).

Tyrant

Original Poster:

663 posts

229 months

Saturday 25th July 2015
quotequote all
Countdown said:
Car allowance is calculated based on days worked.
I think that's an important distinction. It's not how it has been calculated in my case, they've used the same pro rata calculation as for salary.

Sheepshanks

32,522 posts

118 months

Saturday 25th July 2015
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I don’t know if there are any specific rules but when I got made redundant I got car allowance paid for my 3 months in lieu of notice, but no extra was used in the redundancy payment calculation – that was just a multiple of my salary.

I did have some unused holiday, which was paid too, but I don’t recall car allowance being added to that. I think I’d have noticed as car allowance was a bit of an issue as I was always paid more than I strictly should have been (we had different rates for head-office and branch staff) but they calculated the notice payment based on the correct amount.

Countdown

39,688 posts

195 months

Saturday 25th July 2015
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Tyrant said:
Countdown said:
Car allowance is calculated based on days worked.
I think that's an important distinction. It's not how it has been calculated in my case, they've used the same pro rata calculation as for salary.
Possibly I've misunderstood. I thought you were getting pay in lieu of untaken annual leave but your car allowance WASN'T being adjusted (i.e. if you are being paid 10 days urn taken leave you aren't getting 10 days car allowance as well).

If that's correct then that is the system that's operated in every place where I've worked. Ad hoc allowances don't get adjusted / pro-rata'd for untaken annual leave (or if you take TOO MUCH annual leave either)

Your car allowance should be paid up to the date on your P45.

Moonhawk

10,730 posts

218 months

Saturday 25th July 2015
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Tyrant said:
I'll make sure I take the holiday if in that position againscratchchin
Why? Surely you are better off financially because you didn't take it.

Tyrant

Original Poster:

663 posts

229 months

Sunday 26th July 2015
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Moonhawk said:
Tyrant said:
I'll make sure I take the holiday if in that position againscratchchin
Why? Surely you are better off financially because you didn't take it.
No... I needed the holiday in time. As I couldn't take it during the notice period I was paid in lieu and took time off between jobs. This left me worse off (by the car allowance payment) than had I had leave in the notice period and started the new job earlier.

Hackney

6,810 posts

207 months

Sunday 26th July 2015
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Your leaving date shouldn't change whether you take holiday or not.
If you're last day is 31st July, they pay you for holiday accrued up to that date or you take days off *before 31st July*

Car allowance would also be paid until that date.

If you have accrued 5 days holiday up to 31st July and take those days holiday your holiday from 27th to 31st July your leaving date is still 31st July, not 24th.
You still get paid car allowance up to the 31st of July.

Countdown

39,688 posts

195 months

Sunday 26th July 2015
quotequote all
Hackney said:
Your leaving date shouldn't change whether you take holiday or not.
If you're last day is 31st July, they pay you for holiday accrued up to that date or you take days off *before 31st July*

Car allowance would also be paid until that date.

If you have accrued 5 days holiday up to 31st July and take those days holiday your holiday from 27th to 31st July your leaving date is still 31st July, not 24th.
You still get paid car allowance up to the 31st of July.
"Leaving date" is the date that appears on your P45. If OP's last day in the office had been on the 24th and then he had taken 5 days leave then (as per your example) he would have received all payments up to 31st July. But (I think) in this example OP's last final actual date of employment with Widjets Plc was 24th July.