No right to carry-over payment for unpaid holidays taken

Joan Pettingill Joan Pettingill 18 March 2021

The Employment Appeal Tribunal (EAT) has held that a worker is not allowed carry-over a right to payment where unpaid holiday has been taken by the worker but was not paid.

In the recent case of Smith v Pimlico Plumbers Ltd, the EAT decided that a worker is not allowed to carry over the right to payment for holiday from one leave year to the next where the worker has been allowed to take holiday but has not been paid for it.

Joan Pettingill, director of employment law and HR services at Wake Smith Solicitors, looks at the case.

“Although an earlier case of King v Sash Window Workshop Limited established that a worker is entitled to carry over holiday untaken if the employer refuses to pay them to take their holidays, the judgment in King does not apply where holiday has been taken. In King, holiday was not taken because it was not paid. In the Pimlico case, holiday was taken but was not paid.”

Plumbing and heating engineer Smith worked for Pimlico Plumbers Ltd from August 2005 until 3 May 2011.He presented employment tribunal claims for, among other things, unpaid holiday pay that had accrued over those years. 

He claimed, that although he had been allowed to take holidays and had done so at Christmas, in the summer and on bank holidays, he had never been paid for it and he made a claim for unpaid holiday pay

Pimlico Plumbers Ltd challenged Smith’s claims relating to holiday pay. The Supreme Court ruled that Smith was a worker, rather than an independent contractor. 

Then the holiday pay claim was decided, it was dismissed on the basis that it had been presented out of time. However, in so far as Smith claimed he had been unlawfully refused holiday pay the tribunal considered that Smith’s circumstances were different from those in the earlier King case and his claim failed.”

Joan added: “Holiday accrual, and getting holiday pay right can be a minefield for employers. This case illustrates that subtle differences in treatment of workers when it comes to them taking holiday and getting holiday pay right.”

For more information about defending employment tribunal claims or dealing with tricky holiday pay issues please don’t hesitate to get in touch with Joan Pettingill at Wake Smith via [email protected] or call 0114 224 2087.

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