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Holiday pay guidance reviewed amid fears schools could be left out of pocket

Law firms say mistake in government guidance could lead some schools to pay more than they should

Freddie Whittaker

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The government is reviewing guidance on holiday pay for term-time-only workers after law firms warned a mistake could leave schools and trusts out of pocket.

The non-statutory advice, which comes into effect in April, follows a court ruling in 2022 which means holiday pay for term-time-only workers must be calculated based on the hours they work in a normal week, not pro-rated based on the weeks worked in a year.

An employment appeal tribunal ruled in 2018 that Bedford Girls School music teacher Lesley Brazel was underpaid because of the way her holiday pay was calculated.

Four years later, the Supreme Court quashed an appeal by the school鈥檚 parent charity, the Harper Trust.

Previously, Brazel鈥檚 holiday pay was based on what she would earn in an average week, multiplied by 5.6, the statutory number of weeks of leave in England.

But the trust changed its approach to pay in 2011, calculating the total number of hours she worked each term, and paid per for 12.07 per cent of that figure.

Confusion over ‘part-year workers’ definition

, published in January, focuses on two types of worker affected by the change. Irregular hours workers are those whose paid hours are 鈥渨holly or mostly variable鈥.

Part-year workers, according to the guidance, are those for whom there are periods of at least a week 鈥渨hich they are not required to work and for which they are not paid鈥.

It gives an example of a worker who is paid 鈥渁n annualised (flat) salary over 12 months but has periods of time that last more than one week where he is not working鈥.

He 鈥渨ould not qualify as part-year worker if his contract reflects that there are weeks where he is not working and there are no weeks where he does not receive pay鈥.

It is this section of the guidance that has caused confusion, law firms said, because it appears to suggest term-time only workers who are paid in 12 instalments throughout the year do not count as part-year workers.

In published on its website, Browne Jacobson said: “Put simply, we think the non-statutory guidance has got this wrong.”

Schools could end up paying more

Sarah Linden, senior associate at Browne Jacobson, told Schools Week the confusion 鈥渃ould result in education employers providing, and paying, term-time-only [workers] for more statutory holiday than they otherwise need鈥.

Leora Cruddas
Leora Crudda

鈥淭he non-statutory guidance suggests employers must continue to provide these workers with 5.6 weeks of statutory holiday, rather than being able to make use of the new statutory holiday entitlement calculation that would otherwise effectively pro-rate these workers鈥 entitlement based on the amount they work.鈥

But she added that 鈥渋n practice, it鈥檚 a technical issue鈥 and 鈥渓ikely to be of limited impact鈥 for schools and trusts that follow the National Joint Council process for support staff pay and conditions.

鈥淭his is because TTOs are entitled to a pro-rated share of the full-time contractual holiday entitlement set out in the green book proportionate to their working time.鈥

The firm said it recommended trusts and schools聽“consider amending their TTO contracts to make the position clear”.

Government reviewing guidance

CST chief executive Leora Cruddas said: “The uncertainty over the legal framework for holiday pay arrangements for part-time staff has been going on for too long, and it is important that both trusts and staff can finally get certainty on this.

鈥淭his looks to be a simple drafting oversight in the guidance and we are calling on the government to correct it as soon as possible to bring that much needed clarity.”

Approached with the concerns, a Department for Business and Trade spokesperson said they were “currently reviewing the guidance and will provide an update in due course”.

“Whilst the legislation defining a part-year worker applies to all sectors, we recognise this has a unique impact on those working in education.

Law firm seeking ‘revision and clarification’

, another law firm that specialises in education, states that 鈥渦nhelpfully, [the guidance] gives an example which could be interpreted to indicate that because term-time-only staff are paid in 12-monthly instalments, they would not be considered part-year workers鈥.

They said the guidance was 鈥渨rong鈥, and that changes to the law 鈥渢ake primacy over the non-statutory guidance鈥.

They said they were 鈥渋n contact with the Department for Business and Trade to seek a revision and clarification to the non-statutory guidance鈥.

But they added that while the guidance left a 鈥渟mall amount of doubt as to calculations for TTO staff鈥 we do not think this should necessitate any action from schools or colleges鈥.

Term-time-only workers are 鈥渓ikely to fall within the definition of a part-year worker as they tend to have periods of at least a week which they are not required to work and for which they are not paid鈥.

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