Are you holiday pay ready?

news article

Mar 7 2016

SHARE THISShare on FacebookShare on LinkedInTweet about this on TwitterEmail this to someone

After almost four years of debate, the Employment Appeal Tribunal has confirmed that employers will have to include commission when calculating holiday pay.

So if your employees are paid anything other than an ordinary salary for standard working hours, ask yourself, are you holiday pay ready?

Holiday pay essential

The decision comes following the long-running case of Lock v British Gas Trading Ltd, which was first brought to the tribunals in spring 2012. As a British Gas salesperson, Mr Lock was paid a basic salary plus commission, but when on annual leave he was remunerated at the lower basic pay level.

He argued this gave him a disincentive to take time off. The tribunal case was therefore passed to the European Court of Justice (ECJ) who found that because the commission was directly linked to Mr Lock’s work, it should be taken into account for holiday pay calculations. Once back with the UK tribunals, they also ruled in favour of Mr Lock.

The recent EAT decision follows an appeal by British Gas, which was dismissed.  Trade union Unison has hailed this a “victory for workers and a victory towards fair pay in this country and beyond”. The outcome will also no doubt influence a number of other pending holiday pay cases throughout the UK.

Commenting on the news, Cascade’s HR manager Donna Larvin said:

Some organisations may have been dreading this outcome, but it must be acknowledged that employees must not be deterred from taking time out for the rest and recuperation that they need. The decision has been made, so the main focus now should be to ensure policies and processes are implemented to ensure compliance.

Mindful that this case was reaching its climax, Cascade recently prepared a white paper on the subject of best practice holiday pay calculations. You can obtain your free copy here:


If you would like to speak to a member of the team regarding the support that HR and payroll software can provide, please call Cascade on 0113 255 4115 or email


Cascade HR Software Brochure.


Book a demo of Cascade HR Software.


  • HR

    Cascade’s Core HR solution is a powerful, proactive and dynamic solution that offers a huge amount of standard functionality” from the HR page.more...


    Cascade isn't a HR system with a bolt on Payroll system from another supplier. Cascade is an integrated HR and Payroll solution from one supplier.more...


    The module will bring the administratively-complex process of auto-enrolment to life, making it incredibly clear what HR and payroll professionals need to do and when. In turn this will allow each department to retain control over their own tasks at the same time as encouraging legislative compliance.more...


    Cascade delivers a comprehensive and powerful recruitment solution designed to reduce administration and ensure best practice.more...


    Online Recruitment represents the next generation in online recruitment functionality for your organisation's own website.more...


    Employee expenses and mileage claims have now been made even easier to process, saving time and increasing efficiency within your organisation.more...


    Gain efficiencies through minimizing costs and maximizing employee time, with zero paperwork and maximum control.more...


    Rolling out Self Service to Employees and Managers presents huge benefits to everyone but there are risks.more...


    Cascade reflects the need to take each employee and assess their individual training and development requirements.more...


    Cascade introduces workflows, best practice workflows and authorisation routes to ensure efficiency and guarantee no task is left incomplete.more...


    Cascade's Mobile Apps module allows you the HR team and your organisation to engage even further with your employees.more...

Related Posts

Book a free demo

Call 0344 815 5566

Get a Free Info Pack


Cascade HR is a well-established, award-winning provider of fully-integrated HR and payroll software. The company is renowned as much for its quality of project management and ongoing customer service levels, as it is its dynamic technology. Over