Holiday allowance/law
Discussion
I have a quick question regarding holiday pay entitlement.
I am an employee, I work in private healthcare. My pay calculation is fairly complex so bare with me.
I have a very low base salary (something like £1200/month) but then I earn a % of how much money I bring into the clinic, once I bring in over £3500 (I think). It is fairly easy to hit that amount, usually under 1.5 weeks. After that, I start getting a %. I can't remember exactly but it's something like 35% from £3500-6000, 40% £6000-8000, 45% £8000-10000 and 50% above £10k. I also get bonuses, over £7k income I get £300. Over £10k I get £700 (on top of the £300), over £12k I get £1k (on top of the £300 + £700).
Got all of that? Good
Now, let's assume for arguments sake in a month I typically earn £5500. If I have a week holiday, I will almost certainly lose the £10k £700 bonus (the £12k one is hard to hit, a few times per year), plus obviously I miss out on the commission I would earn during the week I'm off. So if I have a week's holiday, my pay may drop from £5500 to about £3500.
My boss says I am getting holiday pay because I'm getting my base salary of £1200 or so, but in my view if I get paid for holiday, having a week off wouldn't effect my earnings.
Is this in line with employment law? Just thought I'd double check because someone mentioned it might not be. I have been working there for over 10 years and, generally speaking, the boss is a nice guy who I get on well with.
Many thanks.
I am an employee, I work in private healthcare. My pay calculation is fairly complex so bare with me.
I have a very low base salary (something like £1200/month) but then I earn a % of how much money I bring into the clinic, once I bring in over £3500 (I think). It is fairly easy to hit that amount, usually under 1.5 weeks. After that, I start getting a %. I can't remember exactly but it's something like 35% from £3500-6000, 40% £6000-8000, 45% £8000-10000 and 50% above £10k. I also get bonuses, over £7k income I get £300. Over £10k I get £700 (on top of the £300), over £12k I get £1k (on top of the £300 + £700).
Got all of that? Good
Now, let's assume for arguments sake in a month I typically earn £5500. If I have a week holiday, I will almost certainly lose the £10k £700 bonus (the £12k one is hard to hit, a few times per year), plus obviously I miss out on the commission I would earn during the week I'm off. So if I have a week's holiday, my pay may drop from £5500 to about £3500.
My boss says I am getting holiday pay because I'm getting my base salary of £1200 or so, but in my view if I get paid for holiday, having a week off wouldn't effect my earnings.
Is this in line with employment law? Just thought I'd double check because someone mentioned it might not be. I have been working there for over 10 years and, generally speaking, the boss is a nice guy who I get on well with.
Many thanks.
There is case law in place for this type of position, i'll post a link below but I would advise you seek professional advice from a Solicitor and not take it at face value, the point being there is a precedent which may assist
https://sasdaniels.co.uk/blog/commission-payments-...
https://sasdaniels.co.uk/blog/commission-payments-...
When I worked as a salesman I was paid a basic salary of £30k + 3% commission on sales + £1. 5k per quarter if I hit the sales targets + an extra £1.5k bonus of I hit the annual target. So maximum earnings of £43.5k (including commission on £200k sales target).
No allowance was make for time not selling during my 25 days annual holiday or Bank Holidays; nor did I expect there to be. Equally if I was off work due to illness.
I still hit my targets every year.
No allowance was make for time not selling during my 25 days annual holiday or Bank Holidays; nor did I expect there to be. Equally if I was off work due to illness.
I still hit my targets every year.
Jamescrs said:
There is case law in place for this type of position, i'll post a link below but I would advise you seek professional advice from a Solicitor and not take it at face value, the point being there is a precedent which may assist
https://sasdaniels.co.uk/blog/commission-payments-...
Interesting, thanks.https://sasdaniels.co.uk/blog/commission-payments-...
loskie said:
I've approached ACAS a few times over holiday pay. Their responses were frustrating. I can't say I've been impressed with any contact I've had with ACAS. Nobody appears to know what they are doing and they never give a straight answer. Jasandjules said:
It is not a surprise that the answer is not quite clear cut. The starting point is what does your contract say? Then do you have fixed "normal working hours"?
Yes, I have fixed hours each week over a 2 week rota. However, this has since changed. After covid we changed a few things and my working week is now approx 2.5 hours longer than before, give or take.I haven't seen the contract in many years but I believe it said we got holiday pay based upon our base salary, but I couldn't swear to that. But even if it says that, but the law says it's not in line with employment law, does that matter, I wonder?
Wills2 said:
If one of my team goes on holiday they get paid on the business their clients bring in whilst they are away anything else would be unfair, but if they (the sales) don't come in they won't get the commission as there is nothing to base the payment on.
I think this is the situation I'm in, but I'm not sure it's strictly "right", as I gather employment law says that holiday pay should account for your typical earnings. I believe it's averaged these days:
https://www.citizensadvice.org.uk/work/rights-at-w...
There may be exceptions based on sector, so you'd have to check specifics.
M.
https://www.citizensadvice.org.uk/work/rights-at-w...
There may be exceptions based on sector, so you'd have to check specifics.
M.
Mortarboard said:
I believe it's averaged these days:
https://www.citizensadvice.org.uk/work/rights-at-w...
There may be exceptions based on sector, so you'd have to check specifics.
M.
Thanks very much. I have spoken to a friend who is an employer in the same position as me, they said it's a legal obligation to pay for average bonuses/commission during holidays.....so I just need to work out whether my boss could turn round and say "fine, but I'm going to reduce your bonuses".....!?https://www.citizensadvice.org.uk/work/rights-at-w...
There may be exceptions based on sector, so you'd have to check specifics.
M.
Defcon5 said:
A year or so ago we started to get an extra payment after being on holiday. It was calculated as a % of the overtime in the 6 weeks prior to the holiday or something.
‘Bear V Scotland’ rings a bell from the info HR sent out at the time
Correct, overtime was clear in Bear Scotland Ltd v Fulton but commission was not expressly dealt with. It was indicated though commission would be included for a person who worked "normal/set" hours‘Bear V Scotland’ rings a bell from the info HR sent out at the time
The issue is what is normal remuneration and why is it given. But in British Gas v Lock this question was noted as being included i.e. what is a normal remuneration for the individual. BUT no firm answer as to how to calculate. So you could consider the last 52 weeks and take an average, or perhaps the last 12 weeks (which is my preference due to the ERA s122 which say this
Subject to section 222, if the employee’s remuneration for employment in normal working hours (whether by the hour or week or other period) does vary with the amount of work done in the period, the amount of a week’s pay is the amount of remuneration for the number of normal working hours in a week calculated at the average hourly rate of remuneration payable by the employer to the employee in respect of the period of twelve weeks ending—
(a)where the calculation date is the last day of a week, with that week, and
(b)otherwise, with the last complete week before the calculation date.)
I have spoken to ACAS who were incredibly helpful. They basically said "yes, you should get the same amount if you take a week off as if you were working" under the work time regulations act. This came in in 2014 I gather. Basically your holiday should be worked out at average earnings over the past 52 weeks.
They also said that holiday can be backdated for 2 years, possibly longer if a judge deems it suitable (I've been there for 10 years....). I am not looking for all of that, it'd cripple my employer, but it'd be nice to get paid for the holiday I've just had and moving forwards.
They said because my commission/bonus entitlement is written in contract they cannot change it unless I legally agree or if it's written they can change it (it isn't).
So I will tread carefully, ask my boss to look into it and ask if I am correct (which I know I am) then just be paid for the holiday I've just had and moving forwards. If it does go a little south I can then show him the ACAS and citizen's advice links. If that goes south they said you could take them to a tribunal and get a lot of backdated pay, but I can't see it coming to that.
Watch this space!
They also said that holiday can be backdated for 2 years, possibly longer if a judge deems it suitable (I've been there for 10 years....). I am not looking for all of that, it'd cripple my employer, but it'd be nice to get paid for the holiday I've just had and moving forwards.
They said because my commission/bonus entitlement is written in contract they cannot change it unless I legally agree or if it's written they can change it (it isn't).
So I will tread carefully, ask my boss to look into it and ask if I am correct (which I know I am) then just be paid for the holiday I've just had and moving forwards. If it does go a little south I can then show him the ACAS and citizen's advice links. If that goes south they said you could take them to a tribunal and get a lot of backdated pay, but I can't see it coming to that.
Watch this space!
Gassing Station | Jobs & Employment Matters | Top of Page | What's New | My Stuff