Employment Case Law Update | Summer 2021

Here we take a quick look at some key employment case law decisions from recent months.

Overtime and holiday pay

Many people were hoping that the Supreme Court decision in East of England Ambulance Trust v Flowers and others would bring clarity to whether the calculation of holiday pay under the Working Time Directive should include an element for regularly-worked voluntary overtime. However, clarity on this issue now seems unlikely, at least in the short term.

For most employees who are paid a regular salary, their pay will remain the same when taking annual leave. However, for employees whose earnings vary significantly due to overtime, on-call pay, or bonuses, the situation becomes more complex. Employers must be able to calculate the employee's normal rate of pay, so that the employee can be correctly paid a normal daily rate during any periods of annual leave.