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Holiday pay and overtime

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The Employment Appeals Tribunal has today announced that overtime payments should be taken in to account when calculating holiday pay - currently only basic pay counts when it is calculated.

Whilst the full details of the ruling have yet to be released, there is the possibility that it could open the floodgates for a series of backdated holiday pay claims from the estimated one-sixth of the UK workforce that receives overtime.

Given the potentially massive financial impact of the ruling on employers however, it is highly likely that an appeal will follow, so the final decision could be some time away.

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