WorkLife

Our thoughts on the world of employment law - and beyond.

Holiday pay – two year limitation period to be introduced

It has just been reported (https://www.gov.uk/government/news/government-tackles-businesses-concerns-over-holiday-pay-ruling) that the government has decided to introduce regulation putting a longstop date of two years on claims for backdated holiday pay. However, there will be a transitional period of six months within which employees can still make claims under the existing arrangements.  As previously discussed, one must query the real value of many of those claims given the EAT’s decision in Bear Scotland, but nonetheless, it is a pretty clear indication that employees need to get their act together sooner rather than later if they are going to bring the bumper value claims about which the media have been so concerned.  There is much speculation as to how the government will implement the limitation, in particular whether it will apply just to holiday pay or all unlawful deductions claims (from the wording of the press release, the latter appears to be the case).  It seems an odd decision all round, and one driven perhaps more by a need to be seen to be doing something, than by any real evidence of a flood of high-value claims emerging (given the implication of the decision on the series of deductions point in Bear Scotland).  Or perhaps, the cynic in me says, it is simply a measure designed to galvanise tribunal litigation just in time to demonstrate that the introduction of tribunal fees has had no real impact at all.

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