In what is the latest in a number of holiday pay cases, the EAT has held that the NHS must include any overtime pay earned in the reference period in the calculation of holiday pay. This includes both non-guaranteed and voluntary overtime.
The case of Flowers and others v East of England Ambulance Trust UKEAT/0235/17 which concerned NHS staff working under clause 13.9 of the NHS Terms and Conditions of Service (Agenda for Change). The EAT held that this should be interpreted as requiring any overtime pay earned in the three months (or any other reference period agreed) before the employee took annual leave to be included in the calculation of their holiday pay. This should include both non-guaranteed and voluntary overtime pay, regardless of whether an employee is contractually required to work the overtime or any pattern to it being worked.
The EAT held that both non-guaranteed and voluntary overtime pay should be taken into account when calculating the four weeks’ paid leave under Article 7 of the Working Time Directive following previous decisions that this should be the case so long as the payments are sufficiently regular and paid over a sufficient period. Following Dudley Metropolitan Borough Council v Willetts and others UKEAT/0334/16, the EAT held that the overarching principle of EU case law is that holiday pay must correspond to normal remuneration and therefore the employee should not be penalised for being on leave. This rationale would follow the other holiday pay cases concerning commission.
Watch this space as it is understood that the Trust is going to appeal this decision.