Holiday pay when working on commission
Discussion
Does anyone in the know, know any more about the recent European ruling on an employee; when a large chunk of their income is commission based, being paid commission still when taking their holiday entitlement and also back payments for up to 16 years; when the Working Time Directive came into force in 1998?
http://www.cipd.co.uk/pm/peoplemanagement/b/weblog...
The reports that I have read seem to indicate that it will happen but no indication as to when and what the final outcome will be.
Thanks in advance.
http://www.cipd.co.uk/pm/peoplemanagement/b/weblog...
The reports that I have read seem to indicate that it will happen but no indication as to when and what the final outcome will be.
Thanks in advance.
Not an expert, but I believe that it depends on the exact wording of an employment contract - some employers are safe and others are not.
One thing I can be sure of - very soon there will be some firms of ''solicitors'' advising people at every opportunity of their right to claim. Just as one of their last doors is closing a new door opens.
One thing I can be sure of - very soon there will be some firms of ''solicitors'' advising people at every opportunity of their right to claim. Just as one of their last doors is closing a new door opens.
mph1977 said:
Does this follow on from the stuff about regular variable pay having ti be taken into account when on leave / sick / suspended ?
I think so, it definately is saying that regular overtime should be also taken in to account when paying holiday pay; there is currently an appeal being heard regarding that element, by the sounds of things once the outcome of the appeal is announced then things will start to happen. This relates to a decision by the European Court of Justice interpreting the Working Time Directive. Extant UK Regulations implementing the Directive must now be given effect subject to the Court’s decision. An employee who is rewarded on a commission basis will need to be paid a notional commission element based probably on average commission over the year as part of his or her holiday pay, in order to produce the situation in which he or she gets the equivalent of the full package whilst away. Claims can be made for underpayments in the last six years.
Breadvan72 said:
HTP99 said:
...
The reports that I have read seem to indicate that it will happen but no indication as to when and what the final outcome will be.
...
It has already happened.The reports that I have read seem to indicate that it will happen but no indication as to when and what the final outcome will be.
...
Breadvan72 said:
This relates to a decision by the European Court of Justice interpreting the Working Time Directive. Extant UK Regulations implementing the Directive must now be given effect subject to the Court’s decision. An employee who is rewarded on a commission basis will need to be paid a notional commission element based probably on average commission over the year as part of his or her holiday pay, in order to produce the situation in which he or she gets the equivalent of the full package whilst away. Claims can be made for underpayments in the last six years.
Is the six years due to the claim limitations (statute of limitations?) in contract law? Secondly is this likely to be overruled, I.e extended beyond 6 years?
6-11years ago 70% of my salary was commission
. Statute of Limitations is an Americanism. We have the Limitation Act 1980, which sets a six year limit for claims based on debt or contract.
I ought to know, but have forgotten and CBA to look up whether or not anyone has successfully argued that to give full effect to EU law the local limitation period should be disapplied where it would operate to limit a Euro right.
I ought to know, but have forgotten and CBA to look up whether or not anyone has successfully argued that to give full effect to EU law the local limitation period should be disapplied where it would operate to limit a Euro right.
HTP99 said:
Breadvan72 said:
HTP99 said:
...
The reports that I have read seem to indicate that it will happen but no indication as to when and what the final outcome will be.
...
It has already happened.The reports that I have read seem to indicate that it will happen but no indication as to when and what the final outcome will be.
...
Breadvan72 said:
Statute of Limitations is an Americanism. We have the Limitation Act 1980, which sets a six year limit for claims based on debt or contract.
I ought to know, but have forgotten and CBA to look up whether or not anyone has successfully argued that to give full effect to EU law the local limitation period should be disapplied where it would operate to limit a Euro right.
Cheers. If my former employee wasn't such a scoundrel I wouldn't give it a second thought, as it is I'll keep an eye on any developments. I ought to know, but have forgotten and CBA to look up whether or not anyone has successfully argued that to give full effect to EU law the local limitation period should be disapplied where it would operate to limit a Euro right.
Breadvan72 said:
HTP99 said:
Breadvan72 said:
HTP99 said:
...
The reports that I have read seem to indicate that it will happen but no indication as to when and what the final outcome will be.
...
It has already happened.The reports that I have read seem to indicate that it will happen but no indication as to when and what the final outcome will be.
...
Assuming the case for overtime payments goes the same way what would be a fair way of calculating lost earnings? Would you calculate an effective daily overtime rate and multiply that by the number of leave days?
i.e. If an employee had typically worked 300 hours overtime annually and taken 25 days leave this equates to 300/340 hours per day, hence lost overtime hours of 25*300/340.
i.e. If an employee had typically worked 300 hours overtime annually and taken 25 days leave this equates to 300/340 hours per day, hence lost overtime hours of 25*300/340.
I am not sure why the six year limitation period has been raised.
You don't need to make a claim for breach of contract.
You don't even need to make a claim under the WTR 1998.
Why not make an unlawful deductions claim in the Employment Tribunal, under the ERA 1996? This type of claim can be back dated to 1998, if applicable.
You don't need to make a claim for breach of contract.
You don't even need to make a claim under the WTR 1998.
Why not make an unlawful deductions claim in the Employment Tribunal, under the ERA 1996? This type of claim can be back dated to 1998, if applicable.
Edited by Zeeky on Sunday 31st August 18:56
I can see two problems with that.
The first is that the underpayment followed from a mistake of computation (the employer being at that time under the same misapprehension of law as everyone else before the ECJ clarified the law). This affords a defence under section 13(4) of the Employment Rights Act 1996.
The second is that section 23(2) of the same Act establishes a time limit of three months from the deduction for making a claim to an employment tribunal. By virtue of section 23(3), this period runs from the last deduction in a sequence of deductions, so someone in the same job for years will be OK (if they can overcome the section 13(4) point), but not so someone suing in respect of a previous job.
The limitation period can be extended under section 23(4)when it was not reasonably practicable to make a complaint within three months, and I would say that it was not so practicable when the law was unclear, but the law was clarified several months ago (ECJ decision of 22 May 2014), and an extension of time should only be for a reasonable period, so arguably a claim made now would be too late.
The statutory right to claim in respect of deductions does not replace the common law right to sue for breach of contract (I always recall that point as I established it in my first ever solo flight in the Court of Appeal, ages ago), so if a claim is barred under the ERA (or does not lie at all because of section 13(4)), it could still run at common law.
The first is that the underpayment followed from a mistake of computation (the employer being at that time under the same misapprehension of law as everyone else before the ECJ clarified the law). This affords a defence under section 13(4) of the Employment Rights Act 1996.
The second is that section 23(2) of the same Act establishes a time limit of three months from the deduction for making a claim to an employment tribunal. By virtue of section 23(3), this period runs from the last deduction in a sequence of deductions, so someone in the same job for years will be OK (if they can overcome the section 13(4) point), but not so someone suing in respect of a previous job.
The limitation period can be extended under section 23(4)when it was not reasonably practicable to make a complaint within three months, and I would say that it was not so practicable when the law was unclear, but the law was clarified several months ago (ECJ decision of 22 May 2014), and an extension of time should only be for a reasonable period, so arguably a claim made now would be too late.
The statutory right to claim in respect of deductions does not replace the common law right to sue for breach of contract (I always recall that point as I established it in my first ever solo flight in the Court of Appeal, ages ago), so if a claim is barred under the ERA (or does not lie at all because of section 13(4)), it could still run at common law.
Edited by anonymous-user on Sunday 31st August 19:29
Decision due today: http://www.bbc.co.uk/news/business-29884867
But
But
Breadvan72 said:
On overtime, a decision of the Employment Appeal Tribunal is expected soon, but I would expect the case to go further, and possibly to take a trip to the ECJ.
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