Holiday taken but unpaid cannot be carried forward for holiday pay claim (Smith v Pimlico Plumbers)

The decision of the CJEU in King v Sash Window Workshop (allowing holiday which could not be taken for a reason beyond the worker’s control to be carried forward for the purpose of a holiday pay claim) does not have the effect of allowing holiday, which was taken, but was not paid for, to be carried forward in the same way. A claim for pay in respect of holiday that has been taken but was unpaid must be brought within three months of the date on which the payment should have been made under (a) regulation 30 of the Working Time Regulations 1998, or (b) section 23 of the ERA 1996, according to the EAT.

Smith v Pimlico Plumbers (UKEAT/0211/19/DA)

What are the practical implications of this judgment?

It should be noted that this judgment by Choudhury P limits the effect of the decision in King v Sash Window Workshop to claims for holiday pay in respect of holiday that was not taken. That holiday (provided it was not taken for a reason beyond the worker’s control) may be carried over from year to year and may form the basis of a claim for payment in lieu on termination. The effect of this judgment is that holiday which has been taken (but was not paid) cannot be carried forward in that way and a claim in that respect must be brought within three months of the date on which the payment should have been made under regulation 30 of the Working Time Regulations 1998 or as an unlawful deduction under section 23 of the ERA 1996.

The judgment is also noteworthy for having the full reinterpreted wording of regulations 13, 14 and 30 of the WTR 1998, which also takes into account the decisions in King v Sash Window Workshop, NHS Leeds v Larner and Plumb v Duncan Print Group.

In addition, on claims relating to a series of deductions from wages where there may be gaps of more than three months between the deductions, this judgment contains obiter comments which indicate that the decision of the EAT in Bear Scotland (that deductions that are more than three months apart cannot be said to form part of a series of deductions for the purposes of section 23) is still good law. Although the issue was academic in the circumstances of this particular case, Choudhury P indicated in the judgment that the decision of the Northern Ireland Court of Appeal in Agnew to the contrary (which is currently the subject of an appeal to the Supreme Court) did not mean that the decision of the EAT in Bear Scotland should not be followed.

Case details

• Court: Employment Appeal Tribunal
• Judge: Choudhury P (sitting alone)
• Date of judgment: 17 March 2021

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