Tom Stenner-Evans
Posted on 1 Dec 2014

Employment Law Update – Holiday Pay / Contract Variations

Workers in Holiday Pay Overtime Ruling Will Not Appeal

We recently informed you of the EAT's decision in the joined cases of Hertel (UK) Ltd v Woods and others, AMEC Group Ltd v Law and others and Bear Scotland Ltd v Fulton and another – that non-guaranteed overtime must be taken into account in calculating statutory holiday pay derived from the Working Time Directive. The judgment also limited the extent to which workers can make retrospective claims for underpaid holiday.

The Unite Union, which represented the Claimants in both Hertel and AMEC, has announced that it will not be appealing the EAT's decision. Therefore, subject to any appeal by the employers, workers claiming underpaid holiday pay will not be able to bring unlawful deductions claims stretching back to the implementation of the Working Time Regulations 1998, as previously thought.

The announcement means that workers will not be able to bring claims based on a series of deductions, where there has been a gap of more than three months between the deductions. Unite has stated that 'we don't want to bankrupt businesses; going forward it is about ensuring employees are paid their fair share, and working with employers to ensure they get their house in order'.

Unite did not represent the Claimants in Bear Scotland, which was heard along with Hertel and AMEC. That case has been remitted to the Employment Tribunal and the parties were not granted permission to appeal.

Contract Variations

Wess v Science Museum Group [UKEAT/0120/14/DM]

The Facts

The Claimant had been employed by the Science Museum since 1979. Originally, she had been entitled to 6 months' notice of termination. In 2003, the Claimant was sent a new contract which reduced her notice entitlement to 12 weeks. Although she didn't sign the contract, neither did she express her objection to the new terms. She continued to work on this basis until her dismissal.

The Judgment

The Employment Tribunal found that the Claimant had impliedly assented to a variation of the contract, and the EAT upheld this decision. Although Tribunals must be cautious in finding implied acceptance of unilaterally-imposed terms, the Science Museum had made it clear that future employment was on the basis of an entirely new contract.

Tips for Employers

In normal circumstances, it would be risky for an employer to rely on 'implied consent' when it seeks to change terms in an employee's contracts, particularly where those terms do not have immediate effect e.g. a sickness or redundancy policy. However, where there is a completely new contract, as in the above, the employee will usually be deemed to have accepted the changes if they work for a period of time without protest. Of particular importance in this case was that the new terms had an immediate effect on the employee, as she had transferred to a new job role.