Smith v Pimlico Plumbers Limited
The EAT held that a worker who had taken annual leave, but not been paid for it, was not able to carry over the right to claim payment for all of this unpaid leave on termination of employment.
The principle set out in King v Sash Window, is that the WTR should be interpreted to enable workers to accumulate, from year to year, a right to payment for their unpaid leave, which would become payable on termination.
The EAT distinguished the facts in this case from those in King. The EAT said in King, the worker had not exercised their right to paid leave because their employer refused to pay for it. In such circumstances, workers must be permitted to carry over their untaken leave until termination, and receive a payment in respect of all of the untaken leave. However, in this case, the EAT said that as the workers had taken leave, albeit unpaid, the principle in King that enabled them to carry over their right to leave from year to year until termination did not apply.
The EAT said the worker could only claim payment for leave taken under Regulation 16 WTR, and any such claim must be submitted within three months of the last date on which the worker should have received holiday pay.
This decision is likely to have a huge impact on holiday pay claims that might have been pursued on a worker’s termination. Such claims may need to be pursued within three months of the date on which the worker should have received holiday pay, and the amount of the previous non-payments that can be claimed may be limited.
