Holiday Pay – The Lock Decision

Published 02/04/2015 00:00:00 in Press Releases

The Employment Tribunal in Leicester has handed down its long awaited decision in Lock v British Gas.

Mr Lock was a Salesman on a basic salary with variable commission paid in arrears.  His commission depended not on the time worked, but the outcome of that work, i.e. the sales achieved.  He could not earn commission whilst on leave and therefore, would lose income by taking it. 

Following the ECJ’s decision last year, the Employment Tribunal has held that Mr Lock’s holiday pay should include an element for his commission. This was largely expected and will impact on future holiday pay entitlement

Sue Robinson Director of the National Franchised Dealers Association commenting on the decision said ‘there are still some unresolved issues following the decision in Lock.  These include:-

  • What is the reference period for calculating holiday pay?  It was hoped that the Leicester Tribunal might clarify whether, for example, a 12 week, or 12 month period was appropriate. It did not do so, so that issue has been deferred for determination at a later date.
  • Prior to 1 July 2015, are there any limits to how far back a series of deductions can stretch?
  • What types of variable pay are intrinsically linked to the tasks performed under the Contract of Employment?
  • It is to be hoped that these and other unresolved issues may be addressed in future cases. We will of course report back to members on future developments in more detail, as and when they arise.’

“This is important news for the Industry as pay in sales inevitably includes a large element of commission pay. It is important to get accurate legal advice on the issue and I would urge all NFDA members to contact us as their trade body".

 

ENDS

NOTES TO EDITORS:

Victoria Gross, Press Officer
Tel: 020 7307 3434
Press Office direct line: 020 7307 3422
Press Office fax: 020 7307 3406

Web: www.rmif.co.uk  Email: victoria.gross@rmif.co.uk

The Retail Motor Industry represents the interests of operators in England, Wales, Northern Ireland and the Isle of Man providing sales and services to motorists and businesses. The RMI has a formal association with the independent Scottish Motor Trade Association which represents the retail motor industry in Scotland.   

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