The UK government is consulting on changes to holiday entitlement for part year and irregular hours workers. The proposal is to amend the Working Time Regulations 1998, which give effect to pre-31 Dec 2020 EU law, to remove the effect of a recent Supreme Court judgment, and in effect to move away from EU law in this respect.
In July 2022, the Supreme Court handed down its judgment on Harpur Trust v Brazel. This case concerned the calculation of holiday pay and entitlement of a permanent part-year worker on a zero-hours contract.
The judgment held that the correct interpretation of the Working Time Regulations 1998 is that holiday entitlement for part-year workers should not be pro-rated so that it is proportionate to the amount of work that they actually perform each year.
Part-year workers are entitled to 5.6 weeks of statutory annual leave calculated using a holiday entitlement reference period to determine their average weekly pay, ignoring any weeks in which they did not work. As a result of the judgment, part-year workers are now entitled to a larger holiday entitlement than part-time workers who work the same total number of hours across the year.
The UK government disagrees with this approach, and proposes amending the Working Time Regulations to ensure that holiday entitlement reflect hours worked. The consultation is here.
The consultation closes on 9 March 2023.