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Redundancy and holiday pay(7 Posts)
Wondering if anyone can help - I have been put on notice of redundancy (which I am completely happy with as the job has changed and I am not really enjoying it any more) - in addition to statutory redundancy pay they will want to pay me lieu of notice. I have a couple of days holiday outstanding but would I also be entitled to the holiday relating to the notice period which they are paying me in lieu for?
They don't have to unless it says so in your contract but many employers will pay in order to avoid any dispute.
To get a definitive answer you need to ask your employer.
It depends. If there is a PILON clause in your contract, then they only have to pay salary not holiday (unless the clause says they will). If there is no PILON clause in your contract, then technically paying you lieu of notice rather than allowing you to work it (therefore accrue holiday) is a breach of contract, which means the payment is essentially damages for loss. If so, it should include holiday as well, as that is one of the losses from not being able to work notice.
Fab - thank you so much. I have been sent home today and am seeing them again next week - think will be the final meeting - but will add these to the list of things I need answers to.
What does your contract say about PILON?
“The company reserves the right to make pay in lieu of notice for all or part of your notice on termination of employment. This provision, which is at the company’s discretion, applies whether the notice to terminate the employment is given by you or the Company. Any such payment will consist of normal contractual payments and shall be subject to deductions of tax and National Insurance contributions as the Company is required or authorised to make”.
Also if the half year performance bonus is due shortly would I be entitled to that?
If so, it should include holiday as well, as that is one of the losses from not being able to work notice
There is a counter argument that, if the employee had worked their notice, the employer could force them to take the outstanding holiday as part of their notice period, so the employee hasn't actually lost anything.
When advising an employee I would say that, unless there is something specific in their contract, the employer may not have to pay up. When advising an employer I would recommend that they pay up rather than take the risk of a dispute over what is generally, for the employer, a relatively small sum of money.