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Sample written statement of main terms and conditions of employment

Published November 2014

Use the guidance set out in the Self Help Guide on Preparing a Written Statement of Main Terms and Conditions of Employment to complete a draft statement

Note : Item 12 Holiday Pay

Holiday Pay and Overtime Update: 4 November 2014

On 04/11/2014 the Employment Appeal Tribunal handed down its judgment regarding the case of Bear Scotland Ltd v Fulton (and other joined cases). Before this ruling, voluntary overtime was not typically included when calculating a worker's rate of holiday pay.

The judgment has clarified that:

Workers should have non – guaranteed overtime taken into account when they are being paid annual leave. It may also be that regular voluntary overtime should also be included if it is part of a worker’s normal remuneration.

Anybody making a claim must have had an underpayment for holiday pay that has taken place within three months of lodging an employment tribunal claim.

If a claim involves a series of underpayments, any claims for the earlier underpayments will fail if there has been a break of more than three months between such underpayments.

The judgment only applies to 4 weeks of a worker's annual leave - this is the basic amount of leave required under the EU Working Time Directive. It does not apply to the further 1.6 weeks of additional annual leave required under the UK Working Time Regulations, or to any further contractually enhanced annual leave allowances.

It is important to keep in mind that the Employment Appeal Tribunal has given permission for this judgment to be appealed to the Court Of Appeal, which means that any final decision is likely to be some time away (at the time of writing, an appeal has not yet been lodged, but is expected to be).

In the meantime, employers, workers and trade unions are encouraged to discuss any concerns arising from this judgment with each other with a view to seeking agreement on any temporary measures or policy changes they feel may be necessary.

The Labour Relations Agency will continue monitoring this situation and will update this publication accordingly

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