Previous Years' Holiday Carried Forward When Calculating Redundancy Payment 22 May 2020 at 3:16PM in Redundancy & redundancy planning 6 replies 153 views

Zesty_Maximus

Hello, 
Unfortunately it looks like redundancy is on the cards and I need some clarification on something I can't find the answer to online.  
If my company allows unused holiday (above the statuatroy minimum) to be carried forward, is this added to the calculation when being made redundant?  
Eg: 6 Days carried over +12.5 days earned this year so far -2.5 days holiday taken this year = 16 days holiday to be paid.  My employer is arguing that although they previously agreed to me carrying over the 6 days from last year, due to redundancy they are now lost and that I only receive 10 days holiday.  
Is this correct or can my employer, having previously allowed these 6 days holiday to be carried over, now state that won't be added to my holiday pay upon termination due to redundancy?  
Thank you

General_Grant

Zesty_Maximus said:

Hello, 
Unfortunately it looks like redundancy is on the cards and I need some clarification on something I can't find the answer to online.  
If my company allows unused holiday (above the statuatroy minimum) to be carried forward, is this added to the calculation when being made redundant?  
Eg: 6 Days carried over +12.5 days earned this year so far -2.5 days holiday taken this year = 16 days holiday to be paid.  My employer is arguing that although they previously agreed to me carrying over the 6 days from last year, due to redundancy they are now lost and that I only receive 10 days holiday.  
Is this correct or can my employer, having previously allowed these 6 days holiday to be carried over, now state that won't be added to my holiday pay upon termination due to redundancy?  
Thank you

First of all I'd argue that those 2.5 days holiday already taken come off the 6 days carried forward.

Zesty_Maximus

Great suggestion - thank you. 

Hoping someone can advise me on whether they can refuse to pay any of what was previously agreed could be carried over? 

blue.peter

The employer's position looks dubious to me. I think that they're trying to pull a fast one on you. All of your holiday - whether carried forward or earned in the present year - is a debt owed to you by your employer under your contract of employment. I'm not aware of exception in the case of redundancy.

So I'd suggest that you start by looking at what your employment contract says about holiday entitlement and, in particular, loss of it on redundancy.

Ultimately, though, I fear that if the employer holds its position, you might need to involve an employment solicitor. That. of course, has a cost implication. Is it worth it?

blue.peter

PS - I've just checked the calculation that I obtained from my former employer's HR department when I was made redundant in 2015. For what it's worth, my carried forward holiday was definitely included in the calculation of what I was paid. Obviously, it doesn't necessarily follow that yours will be, because our employment contracts might say different things. However, I think that my situation is indicative of the norm, if only because I worked for a large company (one with several thousand staff).

My calculation looked like this:

210 (full time entitlement) / 12 * 9.5 = 166.5 hours

3.5 banked days * 7 = 24.5

166.5 + 24.5 = 191 hours entitlement

11.5 (days taken) * 7 = 80.5 hours

191 – 80.5 = 110.5 hours owed

S / 12 / 21.75 * 5 / 35 = £H (hourly rate of pay)

H * 110.5 = £P holiday pay owed to you

Where S = annual salary

Banked days = holiday carried forward

9.5 = number of months actually worked in the year (my termination date was in mid-October)

Zesty_Maximus

Thank you blue.peter. That is really very helpful and much appreciated. 

sharpe106

As they agreed to it they still owe you it. I would agree the 2.5 days should have been from last year first. How you are going to get them to agree to pay it I am unsure without getting a solicitor which would probably cost you more then you get.

If they stick to their position could you not offer to finish a few days earlier, so you still get the time off even if you don’t get any extra money for it.