Back in September 2016 the case of Brettle v Dudley Metropolitan Borough Council decided that voluntary overtime payments should be included in calculating holiday pay, provided that overtime is worked with “sufficient regularity” to constitute “normal pay”.
In July 2017, the Employment Appeal Tribunal upheld this decision and set out that payments for normally worked, voluntary, overtime must be included when calculating holiday pay for the first four weeks of holiday. The case that upheld this was Dudley Metropolitan Borough Council v Willetts and Others, available here.
In this case the EAT explained that, given holiday pay needs to correspond with “normal remuneration”, any voluntary overtime payments that are paid over a sufficient period of time on a regular basis fall within this definition.
This did leave some questions open, however. For example, the EAT offered little guidance on the level of regularity or frequency required for a payment to qualify as “normal remuneration”. We can only ‘watch this space’ but we’ll post a longer summary in a few weeks… so watch this space.
