‘De-risking’ and financial exclusion
Public holidays can be very tricky when trying to work out part-time and casual staff's wages fairly: so here is a quick guide to do some of the work for you.
You will want to make sure that part-time employees are not prejudiced in comparison with full-time employees, so as to minimise the risk of any claims brought against the company by part-time employees.
Yet at the same time this needs to be balanced so that they are not over-compensated, since, aside from equality issues, the morale of full-time employees can be adversely affected. So getting it right is important.
One difficulty that commonly arises is in relation to public holidays
Usually there are eight public holidays in England and Wales each year. Four of these always fall on a Monday (Easter Monday, the Early May bank holiday, the Spring bank holiday and the Summer bank holiday) and one always falls on a Friday (Good Friday). So what if you have part-time employees who typically work Tuesdays, Wednesdays and Thursdays?
Best practice, and the most effective way to achieve equality in this situation, is to give the part-time employees a pro-rated entitlement to all public holidays.
For example, if an employee works three days a week (i.e. 60% of the days worked by his or her full-time colleagues) best practice would dictate that he or she is allocated 60% of the eight public holidays: 4.8 days.
After taking into account any public holidays that fall on the part-time employee’s normal working days (which he or she would take as leave in the same way as full-time employees), the part-time employee should be given the remainder of the 4.8 days as additional leave.
Unfortunately the administrative burden of ensuring equality of this kind can be great. Rather onerously, the calculation has to be worked through separately in relation to each calendar year.
Not only can the total number of public holidays each year vary (for example in 2011 we had an extra public holiday for the Royal Wedding and, in 2012, for the Queen’s Diamond Jubilee) but also the days of the week of some public holidays vary (for example Christmas Day, Boxing Day and New Year’s Day).
However as an employer you should weigh this burden against the risk of failing to address this issue: if you do not adopt this approach, a part-time employee can bring a claim in the employment tribunal for loss on account of unfair treatment.
If he or she is a long-standing employee, the amount of loss he or she suffered can really rack up. Dealing with the matter correctly at the outset is, as is usually the case, the best option.
This blog was first published on www.growthbusiness.co.uk.
For further information, please contact a member of the employment law team.
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