Holiday Pay

Stuart Darke ISM’s Director of Legal Services, discusses the long awaited judgment of The Supreme Court in the case of Harpur Trust v Brazel, handed down on 20 July 2022. In this feature we will to know when considering your own circumstances.

What is the background to the case?

Mrs Lesley Brazel is a music teacher at Bedford Girls’ School, which is run by the Harpur Trust. She has worked there for 20 years and is an alumna of the school. Like many visiting music teachers, Mrs Brazel is contracted to work all year round but only teaches during term time. She has no guaranteed hours and her hours – and therefore pay – can vary from week to week.

In 2011, the Harpur Trust changed the way in which it calculated holiday pay. It started using guidance from ACAS which said that holiday pay could be pro-rated at 12.07% of basic hourly pay. This left Mrs Brazel worse off because she is only contracted to teach during term-time.

After approaching the ISM legal team in 2013, Mrs Brazel was supported in trying to resolve the issue with the Harpur Trust. This involved correspondence with the Harpur Trust, attending meetings with Mrs Brazel and commissioning a barrister’s opinion on the case. Despite the ISM’s intervention the Harpur Trust did not change its position and the matter was referred to the ISM legal expenses insurer.

An Employment Tribunal claim was launched but it found against Mrs Brazel and the matter was appealed to the Employment Appeal Tribunal. The Employment Appeal Tribunal overturned the Employment Tribunal decision and agreed with Mrs Brazel that her holiday pay should be calculated in line with the Working Time Regulations, which did not allow for the pro-rating of pay.

The Harpur Trust appealed to the Court of Appeal and in 2019 the appeal was dismissed. Following the Court of Appeal decision, ACAS withdrew its guidance about for Business, Energy & Industrial Strategy updated its guidance in 2020 to cover term-time and part Court of Appeal decision.

The Harpur Trust appealed to The Supreme Court. The case was heard in November 2021, with judgment being handed down in July 2022. The Supreme Court dismissed the appeal and held that Mrs Brazel’s holiday pay should be calculated by determining average weekly pay and multiplying it by 5.6 in line with the Working Time Regulations. In dismissing the Harpur Trust’s appeal, The Supreme Court has unanimously backed the ISM’s interpretation of holiday pay law.

Responding to The Supreme Court ruling, Mrs Lesley Brazel said, ‘As an alumna of the school where I have now been teaching for over 20 years, pursuing a career I am passionate about, it has been personally challenging for me to see through this long and arduous case. ‘I am pleased to have secured my holiday pay rights, in accordance with the law and my contract of employment, in the highest court from this verdict. I would like to thank my legal team and the ISM for their support over many years – this would not have been possible without them.’

Deborah Annetts, CEO of the ISM, commented: ‘This is a landmark decision from The Supreme Court and is Many of those will be in low-paid and insecure jobs.

We always do our utmost for our members, and we hope that this verdict will mean that any other worker who has not received their proper holiday pay entitlement will now see it changed in line with this judgment.

‘I’m delighted for Mrs Brazel and pay tribute to her to her. I would also like to thank the ISM legal team who support members every day; I am very proud of the ISM team for the work they do. This result could not have been achieved without the help and support of a wider legal team funded by the ISM’s legal expenses insurance, which is available to all ISM members.’

What does the law say about holiday pay?

The law governing holiday entitlement and pay is contained in the Working Time Regulations. These state that all workers are entitled to a minimum of 5.6 weeks’ paid holiday each year.

For full-time or part-time workers with the same hours each week who work all year around, this is an easy calculation. They must be given at least 5.6 weeks of holiday and they are paid normally for their time off.

It is more complicated when a worker is engaged part of the year with hours which vary on a week-to-week basis.

To calculate average weekly pay, an employer should use the last 52 weeks of pay, ignoring any weeks where no pay is received and count only weeks in which pay, however minimal, was earned. The total amount earned in those 52 weeks is then divided by 52 to work out the average weeks’ pay.

Once the average weekly pay is calculated this is multiplied by 5.6 to calculate the annual entitlement to holiday pay.

The Harpur Trust was using a pro-rata method to calculate holiday which is not included in the Working Time Regulations. The 12.07% that it was using represents the proportion that 5.6 weeks of annual leave bears to the total working year of 46.4 weeks. However, it does not work for people who teach term-time only,

What does the judgment mean?

The judgment means that the law in this area has now been for a whole year but are only required to work for part of the year. This will include anyone who is employed or works over a whole year but is only paid for work they complete in part of the year eg visiting music teachers or hourly-paid lecturers in Further and Higher Education.

The Supreme Court drew a distinction between workers The judgment won’t affect part-time workers who are contracted to work all year round, as long as they receive their 5.6 weeks of paid holiday each year.

The Supreme Court rejected the idea that holiday pay could be paid on a pro-rata basis, as that is not what the legislation allows for ‘part-year’ workers.

What should ISM members do?

The rules on holidays and holiday pay only apply to workers and employees, so if you are genuinely selfemployed then this won’t affect you. If you have a contract for a whole year but only work for part of the year, you should check how your holiday pay has been calculated.

This can be done by checking payslips or by asking your employer.

Employers should look at the method which they have been using to calculate holiday pay and, if necessary, make adjustments to ensure they are compliant with The Supreme Court decision. They should keep staff informed of all the steps they take to bring their holiday pay arrangements into line with The Supreme Court judgment.

This is a complicated area of law and if you have any concerns about holiday pay contact the ISM legal team via email at legal@ism.org. Tribunal deadlines are strictly enforced, so it is sensible not to delay.

Workplace rights: Music education In this session, we will discuss rates of pay, employment status and contracts, and the judgement from The Supreme Court holiday pay case and how it may apply to you. The webinar on 15 September will be presented by ISM Research Associate Dr Jodie Underhill, author of The case for change: The music education workforcein 2022, ISM Director of Legal Services Stuart Darke, and ISM Senior Legal Advisor Nerys Owen. Sign up to the webinar: bit.ly/3p5BKyC and if you would like to submit a question in advance, please email: enquiries@ismtrust.org