Holiday Pay – Should Commission Be Included?

The ECJ has held in Lock v British Gas Trading Ltd that commission should be included in holiday pay as under the Working Time Directive ("WTD") a worker is entitled to receive their "normal remuneration" and should not suffer any financial disadvantage which would discourage him/her from taking holiday. Mr Lock was paid a basic salary plus commission determined by his contract related to sales generated which made up 60% of his total remuneration. When he took annual leave he suffered a reduction in income which reflected the fact that he was not able to generate sales while on holiday. The Court found that as Mr Lock's commission payments were directly and intrinsically linked to the performance of tasks he was required to carry out under his employment contract it should be paid in respect of holiday. However, the ECJ left it for the national court or tribunal to decide how the commission element of holiday pay should be calculated.