Lock v (1) British Gas Trading Limited (2) Secretary of State for Business, Innovation and Skills

Employment Judge Ahmed, sitting alone at Leicester Employment tribunal, found that Regulation 16(3) of the Working Time Regulations 1998 (“WTR”) should be read so that it is consistent with Article 7 of the Council Directive 2003/88/EC (“the Working Time Directive”)  by adding the following paragraph added to it:

“(e) as if, in the case of the entitlement under Regulation 13, a worker with normal working hours whose remuneration include commission or similar payment shall be deemed to have remuneration which varies with the amount of work done for the purpose of section 221.”

The decision was relevant only to the four week basic annual leave and not the additional leave in Regulation 13A. The Learned Judge held that Bear Scotland applied and there was no difference in principle between pay in respect of non-guaranteed overtime and pay in respect of commission since both represented types of normal remuneration. He held that it was permissible and necessary for him to imply words into the WTR in order to comply with the directive.  He was satisfied that the intention of Parliament when enacting the WTR was to comply with the Working Time Directive, the essential feature of which was that holidays should be paid. The decision is likely to open the floodgates for backdated holiday pay claims based on normal remuneration including results based commission.  However, such claims will be subject to the limitation set out in Bear Scotland as to a gap of three months between a series of deductions and the two yearlong stop in from 1 July 2015.

For further information on the ramifications of this decision contact Gillian Crew.