Part-Time Workers - Working Patterns & Holiday Pay
Where a part-time worker increases their working hours, is the employer obliged to recalculate the holiday entitlement retrospectively? No, confirmed the European Court of Justice (ECJ) in the case of Greenfield -v- The Care Bureau Limited.
Ms Greenfield was employed as a care worker from 15th June 2009 to 28th May 2013. Ms Greenfield’s contract of employment stated that her working hours and days would differ from week to week and that she was entitled to 5.6 weeks’ annual leave per holiday year, which ran from 15th June to 14th June each year. In July 2012, whilst she was in the habit of working only one day per week, Ms Greenfield took 7 days leave. This therefore equated to 7 weeks leave and exceeded her annual holiday entitlement. In August 2012, Ms Greenfield increased her hours and began working 12 days on, 2 days off. Ms Greenfield then requested a week’s leave in November 2012 but The Care Bureau refused her request, explaining that she had already exhausted her annual holiday entitlement in July. After the termination of her employment in May 2013, Ms Greenfield raised a claim against her employer for payment in lieu of accrued but untaken annual leave. Ms Greenfield was successful at the Employment Tribunal but the decision was subsequently appealed by the employer. During the appeal, the Employment Appeal Tribunal (EAT) made a reference to the ECJ asking for guidance on a number of questions, including whether a recalculation of a part-time worker’s holiday entitlement should be made when their hours are increased and whether the recalculation should apply to the portion of the holiday year during which the worker’s holidays were increased or to some other period.
The ECJ confirmed that where a worker alters the number of hours they work, a calculation must be performed to recalculate the annual leave entitlement, going forward, based on the new working pattern but that it is not necessary to apply the recalculation retrospectively. This is in line with an earlier ECJ decision which confirmed that when a worker reduced their working hours from full-time to part-time, the worker’s annual leave entitlement already accrued could not be retrospectively reduced. The ECJ also confirmed that this test should be applied irrespective of whether the employment is continuing or has been terminated.
Although this decision does not introduce any new rule in respect of a part-time worker’s holiday entitlement, it also does not address any of the “thornier” on-going issues such as whether the UK Working Time Regulations are compatible with EU law given that they provide that a “week’s pay” for the purposes of calculating holiday pay is to be calculated at the time that the leave is taken rather than when it was accrued. This issue will remain unresolved until the matter is considered by a sufficiently authoritative forum.