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Calculating holiday pay when workers change their hours

In the recent case of Greenfield v The Care Bureau the question was asked that if a part-time worker increases their hours, is the employer obliged to recalculate their entitlement to annual leave retrospectively, even taking into account annual leave already accrued and taken?

The answer was no according to the ECJ.

Ms Greenfield’s contract provided that working hours and days varied from week to week. She took 7 days’ paid leave whilst she was contracted to work 1 day a week (equivalent of 7 weeks’ leave). Shortly after Ms Greenfield began working a pattern of 12 days on and 2 days off as alternate weekends. On leaving her employment she claimed that she had a week of accrued but untaken leave but the Care Bureau informed her that she had exhausted her holiday entitlement.

Ms Greenfield brought a tribunal claim arguing that national law, read in conjunction with EU law, requires that leave already accrued and taken should be retrospectively recalculated following changes in working patterns.

The ECJ held that in the event of increased working hours performed by an employee, Member Stares are not obliged to provide that the entitlement to paid annual leave already accrued, must be recalculated retrospectively according to that worker’s new work pattern. However, a new calculation must be performed for the period during which working time increased.

When a full-time employee reduces their hours to part-time hours the employer cannot reduce the right to annual leave already accumulated during the full-time employment and the same should be said for an employee that’s worked part-time but then later works full-time. It is necessary for an employer to distinguish between different periods of different working patterns and work out the annual leave accumulated separately for each period. The same conclusion should be drawn whether this is during employment or once terminated.

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Calculating holiday pay when workers change their hours

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