Just as a follow up to my post yesterday, the Deductions from Wages (Limitation) Regulations 2014 have now been published, implementing the two year limitation period for holiday pay claims.
The new limitation period is applied, by regulation 2, only to the first category of deductions from wages under section 27(1) of the Employment Rights Act 1996, ie “any fee, bonus, commission, holiday pay or other emolument referable to … employment”. Other types of deductions (from (s27(1)(b)-(j) – including statutory sick pay, maternity pay, guarantee payments etc) are not covered by the restriction. As indicated yesterday, the new provision applies only to claims submitted on or after 1 July 2015.
Interestingly, regulation 3 contains an amendment to the Working Time Regulations to the effect that entitlement to paid holiday under the Regulations is not to be considered a contractual entitlement. One assumes this is an effort to try to put further difficulties in the way of anyone trying to argue that claims can instead be brought in the courts rather than the employment tribunals.
Commentators are split over the likely impact – many are predicting a flood of claims in the early part of the year before the new rules kick in: others think that the impact of the Bear Scotland ruling means that the likelihood of many real high value claims deluging the courts is pretty slim in the first place.