The country has shut down as everyone jets off on their summer holidays, seeking out sun, sea and (I don’t like sand so…) ice cream!

We all know that employees are entitled to a minimum amount of paid holiday during the year to ensure their health and safety by allowing a period of rest and relaxation.

But what do you pay your employees during their holiday? Employment Tribunal claims relating to incorrectly paid holiday pay have been in and out of the news for a number of years now, but do you know what the current position is and what you should be paying?

Obviously, you pay their “normal” remuneration, but what’s “normal”? Well, that depends on the work your employee does and how their pay is calculated. However, in general, when on holiday, your staff should receive the same pay that they would have received had they been at work.

Two key cases on this issue have provided some guidance and confirmed that if employees would normally earn commission or work regular overtime then you may have to include commission and overtime in their pay when on holiday. You will need to work out their average weekly pay in the period leading up to their holiday to ensure they are paid correctly whilst away.

If you’re unsure what elements of pay should be included in holiday pay or how to calculate the average then call Howarths on 01274 864999.

By Sarah Edwards, Employment Law Advisor

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