Harpur Trust v Brazel – plot twist as government consultation begins to address anomalies arising from the judgment

Schools and academies are aware of the widely published judgment of Harpur Trust v Brazel. Last year the supreme court reached its final decision to address the correct legal interpretation of how holiday entitlement must be calculated for permanent part-year and irregular hours workers.

Schools and academies typically use several atypical worker contracts due to the varying and diverse nature of certain posts in schools that are only needed for part of the year. The impact of this case has included claims from workers for unlawful deductions from wages, the settling of claims by employers and changes to payment terms and employment contracts.

The government has recognised that the case, or perhaps more correctly the law as it pertains to holiday pay regardless of the Harpur Trust outcome, creates anomalies whereby part-year workers and irregular workers can benefit from greater holiday entitlement and pay than part-time workers who work the same hours each year. This is because a part-year worker’s holiday entitlement is based on a full year’s reference but excludes any weeks not worked. They are entitled to 5.6 weeks holiday regardless of how many weeks worked and this can mean they receive greater pay and entitlement than a permanent part-time worker. Indeed, the less a part-year worker works, the greater the disparity in pay.

The government seeks to address this disparity and therefore is consulting to understand the impact of the judgment on all sectors.

The consultation began on 12 January 2023 and will end on 9 March 2023. The government is keen to hear the views from as many stakeholders as possible, so schools and academies should consider responding to the consultation.

What does the government propose?

The government proposes keeping the 52-week reference period for holiday entitlement for part-year workers but whereas now the weeks not worked are excluded from calculating holiday pay entitlement, any time not worked would be included going forward to ensure payments were proportionate and fair.

Given the work that schools and academies have gone through to resolve pay issues and to comply with the Harpur Trust judgment, the new consultation may be met with some frustration. However, it is worth bearing in mind that the law as it stands still means that any action taken or adopted in relation to comply with the law for permanent part-year workers or those with irregular hours is still correct.

It remains to be seen how the government will legislate but, as ever, we will keep our eyes open for any legislative changes that change the position and will keep our clients informed.

Further details and the full consultation document ‘Calculating holiday entitlement for part-year and irregular hours workers’ can be found here.

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