Unpaid on leaving employment

[MaverickSnoopy]

DH left his last employer towards the tail end of last year and had worked nearly all of the holiday year. We believe he has been underpaid his remaining holiday by 2 days. He was entitled to 28 days statutory plus 5 days contractual leave, the latter having been acrrued through long service. So a total of 33 days which the contract specifies.

The ex employer have calculated his pro rata amount like this:
33 days - 2 days (for Christmas and Boxing Day as he was no longer employed) / number of weeks in year x number of weeks worked - leave taken
They have made deductions before pro rating.

We believe that they should have:
33 days / number of weeks in year x number of weeks worked - leave taken

The contract says that he is entitled to 28 days holiday (including bank holidays) in a complete year and that it increases to 33 days holiday with service. Note: it does not say annual leave and bank holidays, it groups everything together as "holiday". It also says that on leaving employment holiday will be pro rated and rounded up to the nearest half day.

So when you round up the calculation as we feel he is owed 2 days. We spoke to acas who confirmed our understanding. He then raised a grievance as they would not communicate on the matter. They then ignored the grievance. So DH started the acas early conciliation process and nominated me as his rep, so I'm dealing with it (I used to work in HR and am pretty confident with this stuff).

The ex employer have looked at it and say they stand by their calculation, that they can deduct the 2 bank holidays because he did not work them. I believe that as part of his statutory entitlement they should be pro rated. Acas say that technically he had more than the statutory amount because of his accrued contractual leave, so the company haven't breached the statutory entitlement. I then say but then they have breached the contract and acas have now suggested we take legal advice. According to the acas handbook his entitlement should be pro rated, they say they have pro rated his entitlement but that it is 31 days because he was employed during the two bank holidays and so not the 33 days his contract says.

Honestly we cannot afford legal advice and for 2 days holiday it's hardly worth it, but we NEED the money and were expecting the money. This company have form for treating staff poorly (not paying minimum wage (which I reported anonymously to hmrc about a year ago), getting staff to do unpaid overtime (1 extra day per week - but it's in the contract but was intended as ad hoc) and the legacy staff should have been TUPED over to this company but they said (a very clear tupe situation was not tupe) and so much more. I realise these latter points are not relevant to his case but I'm just saying that their approach is ruthless and they will always push the boundaries of employment law.

Basically my question is, is my understanding correct? Or am I completely barking up the wrong tree. I was confident but this is going on for so long now and they're really pushing back so I'm doubting myself. Acas have to be impartial and so really I need a bit of a sanity check.

Sorry it's so long and for the rambling....trying to do this quickly before school run and then work!

In my work I don't accrue bhs until they have fallen. So if he'd stopped working before Xmas he wouldn't be due those bhs.

I agree with your calculation but doesn’t mean you will get them to see it your way

Thanks both.

But @Ginmakesitallok the bank hols form part of the statutory entitlement. It's the number of days that's important. If you use the government calculator online, based only on the 28 days alone he accrued 26.2 days in the period is worked. So even the gov calculator agrees with that part of it. So for them to be right the gov calculator would need to be wrong.

I believe we are right....it's just they're response is making me doubt myself.

We want to take it to tribunal if they continue to disagree but I don't want to do that if it's ultimately going to get turned down because I've overlooked something or don't understand.

Title should read - underpaid not unpaid.

What does the contract say about how leave will be calculated on termination?

When was his leaving date?

In my work I don't accrue bhs until they have fallen. So if he'd stopped working before Xmas he wouldn't be due those bhs

This is what I was going to ask. Some contracts may say the right to take bank holidays does not accrue and you have to be employed at the time they fall due.

Also did he give proper notice of resigning? I have also seen contracts say that if employees don’t give proper notice they will forfeit holiday over the statutory minimum.

Ask ACAS to start the early conciliation process if you still feel they’re due.

bank holidays do not form part of the statutory entitlement. 28 days (for a 1.0 FTE) is the statutory entitlement. the legislation says nothing about bank holidays.

I'm an employment lawyer. Nobody can answer this question for you without seeing the contract.

Ignore the bank holidays as they would have been taken as they were accrued.

Are you sure they haven’t taken the 2 days off the long service award days?

I would work it out as...

28 days divided by 52 weeks times number of weeks worked.

If they agree that he should have the full extra holidays due to long service then it should be calculated as 33 days.

I would query why they deducted 2 days

So for them to be right the gov calculator would need to be wrong.

The last time I looked at the gov calculator it was actually wrong as it only worked out holiday based on the statutory minimum. I don’t use it but now so it may have changed.

If he only got the stat min then yes it may be different but he gets in excess of the stat min.

Bottom line is without knowing what his contract says and what his leaving date was it’s not possible for us to answer your question.

They could calculate leave on termination as you have suggested they should, but there's no specific requirement for them to do so - as long as he gets the statutory minimum on a pro rata basis.

If the contract/annual leave policy says leave on termination is calculated how you want it to be, then you have an argument, but if it's silent on the issue, you'd be basically arguing that because bank holidays are rolled up in the contract, there's an implied contractual term that leave on termination will be calculated how you describe rather than how they have done it.

I really wouldn't suggest going to a tribunal about it!

Here is the wording from the contract:

"You will be entitled to 28 days paid holiday in each complete holiday year, this includes 8 public and bank holidays, being New Year’s Day, Good Friday, Easter Monday, Early May Bank Holiday, Spring Bank Holiday, Summer Bank Holiday, Christmas Day and Boxing Day. The entitlement will increase by one day for each complete year of service for the initial 5 years of your employment therefore up to a maximum of 33 days holiday per year. You will be paid your normal basic remuneration during such holidays. If your employment finishes part way through the holiday year, your holiday entitlement during that year shall be."

Apologies about weird formatting!

Our argument is that it says he is entitled to 33 days HOLIDAY (and that bank hols fall within that). Holiday is then worked out pro rata when leaving.

They say his entitlement is 31 days because they deduct the 2 bank holidays from his 33 days. He worked 49 weeks out of 52 of the holiday year.

My comment re the gov calculator is obviously based only on the statutory amount. So according to this gov calculator if he had only 28 days holiday his holiday entitlement based on his service would be 26.2 days...yet they have deducted 2 of the 28 iyswim.

I am incredibly grateful for any comments. This is taking up most of my sanity at the moment.

Argh crucial bit I missed off the last line of the contract!

"If your employment finishes part way through the holiday year, your holiday entitlement during that year shall be calculated on a pro rata basis, rounded up to the nearest half day."

Your husband worked 95% of the leave year. He should get 95% of the entitlement which is 31 days so I think it's been calculated correctly unfortunately

They've allocated the bank holidays specifically as forming part of those days.

As such, since the bank holidays haven't happened he doesn't get paid for them.

You will be entitled to 28 days paid holiday in each complete holiday year,

But he didn't work the complete year, unfortunately - very close, but not quite!

I know, if he'd completed the year then he would have had 33 days but shouldn't they be pro rated as per the contract? What they have in fact done is this...

33 - 2 bank holidays / 52 weeks x 49 weeks worked

I think it should be....

33 / 52 x 49

ACAS guidance on line says entitlement should worked out...

Entitlement / weeks in year x weeks worked

The question here is what is the entitlement to start with. Contract says 33 days but they say no its 31.

If you work out 33 / 52 49 it is* 31 days OP

What will help is confirmation of how many days he has taken. The BH are presumably not added to his leave entitlement though, and he just takes off the days as they come up? Sorry to say, but I'm with the org on this. He'd have got the BH if he'd worked them but not if he wasn't employed during the weeks that they fell. That's certainly how all my employers have worked it.

Yes but that's not what they're doing. They are taking the 31 days and pro rating it.

So 33 - 2 / 53 × 49 = 29.2 days

So they have said his entitlement this year was 29.2 days rounded up.

Does he book BH off of his entitlement, or just automatically off when they fall on a work day?

I'm pretty sure that he didn't book it.

Interestingly he started with his new employer the very next working day. He worked the remaining 3 out of the 52 weeks of the holiday year (and was employed over Christmas and boxing day) but didn't get paid for them as they said he hadn't accrued them.

So for those people with other 28 days entitlement who would be responsible in this situation because surely someone has to give them or a portion of them?

I'd say you do have an argument as the entitlement is inclusive of bank holidays and it says pro rata on termination rather than the annual leave element being pro rata and the bank holidays being excluded from that. But I think it's a lack of clarity rather than being rock solid clear in your favour, and I think for two days' pay I'd cut my losses and not spend any more time and headspace on it.

"Interestingly he started with his new employer the very next working day. He worked the remaining 3 out of the 52 weeks of the holiday year (and was employed over Christmas and boxing day) but didn't get paid for them as they said he hadn't accrued them.

So for those people with other 28 days entitlement who would be responsible in this situation because surely someone has to give them or a portion of them?"

No one "has" to give anyone bank holidays off. In his new employment as long as he gets his contractual/statutory entitlement it doesn't have to be on bank holidays. Some employers only let new staff take holiday once it's been accrued. That policy is fine as long as he gets his total entitlement.

You're not entitled to Bank Holidays off though, it's up to the employer.