Hospitality employers could suffer after holiday pay ruling

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The recent ruling from the employment tribunal surrounding holiday pay has left hoteliers uncertain on how it will affect them and their business.

The Employment Appeal Tribunal confirmed that businesses should now factor in overtime when calculating holiday pay, as well as basic salary, but revealed that workers will not be able to backdate their claims to 1998, as previously feared.

This could result insignificant financial implications for UK hospitality businesses, where overtime and shift work are common.

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Alex Mizzi, an associate in the employment department at law firm Howard Kennedy LLP said: “Businesses will now need to base holiday pay on an average of actual earnings, rather than on basic salary as currently permitted under UK law. This decision imposes major additional costs on UK businesses and a significant administrative burden.”

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