The Civil Engineering Contractors Association (CECA) will sit on a task force that has been setup to assess the Employment Appeal Tribunal’s ruling that employees should receive extra holiday pay for working overtime.
The decision in Bear Scotland Ltd v Fulton and Hertel (UK) Ltd v Wood and others and Amec Group Ltd v Law and others found that non-guaranteed overtime must be taken into account for the purpose of calculating holiday pay.
This could significantly increase costs for contractors, punishing them for working to a payment model that has previously been accepted as normal and correct practice. Under the previous system companies only had to count basic pay when calculating wages.
In response to the judgement the Department for Business, Innovation and Skills has created a task force that will examine the decision and consider how affected businesses can be supported, minimising the impact on industry. CECA is one of seven bodies who will be represented on this group.
Chief executive Alasdair Reisner said: “Contractors will rightly be worried about the potential impact that this decision has on their businesses. Having raised our concerns with the Department for Business, Innovation and Skills earlier this year we welcomed its formal intervention as part of the appeal, challenging proposals that any claims could be retrospective. Our initial reading of the judgement suggests that this intervention has been noted, with apparent limits on retrospective claims.
“However, it is important that all aspects of the judgement are considered. We will now work with the government to ensure that both employers and employees are treated sensibly and fairly as a result of the decision.”