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The Weekly paper of the New Communist Party of Britain

Holiday Pay Battles

by New Worker correspondent

HOLIDAY PAY in Britain was one of the few positive things to come out of Neville Chamberlain’s pre-war Tory government. For many workers however, it is still a theoretical concept.

The Resolution Foundation in a recently published report has unsurprisingly found that around half a million British workers do not receive the holiday pay to which they are legally entitled. The worst affected are those in the gig economy on zero-hours contracts who are often not regarded as formal employees at all and thus do not get sick pay.

In recent years the government has increased the resources and power of bodies such as HMRC and the Gangmasters and Labour Abuse Agency (for which we should all go down on our knees and ask for a blessing on David Cameron), which acts to protect workers from exploitation.

Nevertheless, it is largely up to disgruntled workers to hold non-compliant firms to account. More than 100,000 applications were made to the Employment Tribunal system in 2018 on this issue alone.

The Resolution Foundation estimates that that as many as one in 20 workers did not receive any holiday pay despite legally being entitled to at least 28 days per year.

With more than 32 million people in the UK workforce, this means about half a million are affected, but the real figure is nearly triple that when taking into account people who are ‘self-employed’ and thus do not get automatic legal protections for holiday and sick pay.

The Foundation also reports that nearly one in 10 workers do not receive a legally required payslip, thus making it easy for bosses defraud them and at best making it difficult for workers to calculate whether they are receiving the right level of pay, pension and holiday, and to check for any deductions.

Even the HMRC have spotted a massive 200,000 cases of workers not receiving the minimum wage. According to the report at least a quarter of those earning within 5p of the minimum wage are paid less than the legal minimum because of poor recording of hours worked.

At the moment the unemployment figure in Britain has fallen to the lowest level since the mid-1970s and has been falling since the last recession of 2009, however this rise in jobs has been due to a huge increase in low paid and insecure jobs. Not forgetting, of course, that those on workfare or who have had their benefits sanctioned are not included in the unemployment figures. Low trade union membership density has not helped.

young and old

Both young and old workers are particularly affected by these trends, those below 25 and over 65 are the most likely not to receive a payslip. About one in six workers over the age of 65 claim they have no paid holiday entitlement, whilst those who are 25 and under are almost twice as likely be underpaid the minimum wage.

In particular, the hotels and restaurants sector was predictably bad with workers most likely to miss out on minimum legal workplace entitlements, with about one in seven workers saying they did not receive any holiday entitlement, three times the rate across the rest of the economy. Small firms are also bad.

Lindsay Judge, senior economic analyst for the Resolution Foundation, added: “The UK has a multitude of rules to govern its labour market — from maximum hours to minimum pay. But these rules can only become a reality if they are properly enforced. Labour market violations remain far too common, with millions of workers missing out on basic entitlements to a pay slip, holiday entitlement and the minimum wage.”

One particular example of this is at Betfred, the high street betting-shop chain which obviously no New Worker reader ever frequents.

An uncertain number of the company’s 7,000 workers have been short-changed by the company who have only paid holiday pay for their contracted hours rather than the overtime they put in.

One irate worker said: “I don’t know one person in there who doesn’t do overtime. Everyone does it because they don’t have enough staff. It’s disgusting that as workers on 10p or 20p more than the minimum wage we’ve put off taking holidays or are forced to work extra hours before a holiday to make up for the shortfall of wages that shouldn’t even be happening.”

Predictably Betfred blamed the “error” on an outsourced payroll system and a forthcoming change in the reference system from a 12-week to a 52-week reference period, which they said was too difficult.

Since a 2017 Employment Appeal Tribunal case, payments for purely voluntary overtime have been included in holiday pay calculations if they are regular enough to constitute “normal pay”.

Law firm Leigh Day is understood to be speaking to staff to determine whether they could have a legal claim against the company, so doubtless they will take a cut

Tom Blenkinsop, Operations Director for the union, Community, said: “Betfred workers shouldn’t be treated this way and this is the latest example of why the company should engage more with Community as the union for betting shop workers. We hope Betfred will take the necessary steps to resolve the issue as soon as possible, without the need to go down a potentially costly legal route. But we stand ready to take action to ensure our members get what they are owed.”