£40m backdated pay decision could be wide reaching
Employers in Northern Ireland should be taking note of a landmark judgment in backdated holiday pay.
Following a decision by the Court of Appeal to dismiss a challenge raised by Chief Constable George Hamilton, the Police Service of Northern Ireland is facing a £40m bill for over two decades worth of holiday pay owed to its officers. The issue arose because holiday pay had been calculated based on basic working hours, and not the actual hours worked by employees when overtime was taken into consideration. It is a mistake that is likely to have been made by employers across Northern Ireland, and various analysts and commentators have stated that the decision has the potential to affect every worker in the UK, from civil servants to retail staff.
Employers across the country will certainly be watching with interest as events unfold in the coming weeks and months.
The case highlights the importance of employers to stay up to date with employment law and their obligations when it comes to issues such as minimum wage, holiday entitlement and holiday pay, flexible working requests, and other matters which are often misunderstood and can potentially land an employer in a tribunal, or facing a hefty bill some years down the line.