Tuesday

31st May 2016

EU court ruling to boost holiday pay for workers on commission

  • Commission and overtime payments must be factored into holiday pay, the EU's court of justice has ruled (Photo: Cedric Puisney)

Thousands of workers across the EU are set to see a boost to their holiday pay as a result of a ruling by the EU's top court.

On Thursday (22 May), the European Court of Justice found that salespeople whose pay is based on commission as well as a basic salary, must have the commission that they would normally have earned factored into their pay while on leave.

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

Under the bloc's fifteen-year-old working time directive, all EU workers are entitled to at least four weeks of paid leave.

The judgement by the court in Luxembourg could lead to an effective pay rise for the millions of workers across the EU whose pay includes supplements, such as commission, bonuses and overtime payments, which are not paid in respect of their annual leave. The burden of payment would fall on companies and firms.

The ruling hinges on a case brought by UK trade union Unison on behalf of a salesman, Mr Lock, employed by British Gas, for whom commission represented over 60 percent of his monthly pay. He argued that he should have received the same pay while on leave.

British Gas had argued that Mr Lock had been paid his basic salary plus commission from sales he had made during previous weeks.

However, the Court found that because he was only paid a basic wage, the "adverse financial impact" would deter Lock from taking annual leave.

"Such a reduction in holiday pay is liable to deter the worker from actually exercising his right to take his annual leave, which is contrary to the objective pursued by the Working Time Directive," noted the Court.

In a statement, UNISON General Secretary, Dave Prentis, described the ruling as "an extremely important decision that will assist workers across the European Union to argue that they should be entitled to their normal pay, including any commission payments they normally receive, for periods of annual leave".

Contacted by EUobserver, UNISON said that the ruling reflected "a culture" of workers on commission being afraid to take holiday for fear of lost earnings.

But although the court ruling will have to be applied in all 28 EU countries, the new rules on how to calculate holiday pay will depend on the national laws which apply the EU directive.

Lock's case, as well as the rules for the UK, will be decided by a employment tribunal in Leicester.

Investigation

EU never used power to scrutinise emissions labs

The commission has had the power to compel states to send assessments of the companies that test car emissions since 2007, but it has never made a single request.

MEPs fast-track EU border guard plan

EU parliament gives thumbs up to controversial plan for new border guard force that can be deployed to EU states even if they do not want it. Force could be operational by autumn.

Stakeholders' Highlights

  1. European Healthy Lifestyle AllianceSugar-Sweetened Beverage Sales Barometer Unveils Unhealthy Drinking Patterns in Europe
  2. EJCWelcomes EU Commission Code of Conduct on Countering Illegal Hate Speech Online
  3. Access NowEDRi & Access Now Withdraw From the EU Commission IT Forum Discussions
  4. EJCCalls on EU Parliament to Take Action Against MEP who Compared Israelis to "a rash"
  5. EU Sustainable Energy WeekHave Your Say On Europe's Energy Future At Our High-Level Policy Conference.
  6. CESIUpcoming On June 14: CESI@Noon On ‘Labour Market Integration Of Regugees’
  7. ACCAEducation and Training 2020 - Giving Young People the Workplace Skills They Need
  8. EPSUTrade Unions Back New Undeclared Work Platform
  9. European Healthy Lifestyle AllianceCould targeting children’s fitness boost academic performance?
  10. World VisionDeclares the World Humanitarian Summit a Positive Step in a Longer Journey to Ending Need
  11. EJCPresident Dr. Moshe Kantor on Brexit and the Jewish Question
  12. Swedish EnterprisesNew Rules For Posted Workers - Better Protection or the End of Posting ?