Calculating Holiday Pay for Term Time Employees

All workers are entitled to 5.6 weeks paid leave per annum. The ACAS guidelines on calculating lave for casual workers states that the holiday entitlement of 5.6 weeks is equivalent to 12.07% of hours worked over a year. The 12.07% figure is 5.6 weeks' holiday, divided by 46.4 weeks (being 52 weeks - 5.6 weeks). The 5.6 weeks are excluded from the calculation as the worker would not be at work during those 5.6 weeks in order to accrue annual leave.

Mrs Brazel was engaged under a zero hour contract as a music teacher. She only worked during term time. Her employer, The Harpur Trust, followed the advice issued by ACAS and calculated her holiday pay as 12.07% of the hours she worked during the term.

Section 244 of the Employment Rights Act 1996 sets out how a weeks pay should be calculated if a worker does not work normal workings hours - essentially a weeks pay is the amount of the employees average weekly remuneration in the last 2 week period before the holiday. When this calculation was applied to Mrs Brazel's holiday pay, it resulted in a more favourable payment and she brought proceedings to the effect that she had not been fully paid for her holiday leave.

In Brazel v The Harpur Trust, the Employment Appeal Tribunal agreed with Mrs Brazel and held that her employer had miscalculated her holiday pay by applying the 12.07% calculation and that calculating holiday pay on the 12 week average as set out in the ERA was the correct approach.

The effect of the 12-week average approach is that holiday pay as a percentage of annual earnings for a part-timer on a 32-week 'year' would be 17.5%, giving part time workers more holiday pay than a full time worker!

This judgment will be of some significance to some schools, nurseries and teachers. If you would like help or advice as to how this may affect your business then contact Greystone Legal for a free initial consultation.

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