Calculating basic hours for term-time only workers

Posted on March 23rd, 2023

In L Lloyd v Elmhurst School Ltd, the employment tribunal (ET) and then the employment appeal tribunal (EAT) considered the question: was a learning support assistant (LSA) entitled to receive the national minimum wage for basic hours, which fell outside the school terms, even when those hours were not worked?

Ms Lloyd was employed as a part-time learning support assistant at Elmhurst School. She worked three days (21 hours) a week during term-time and she was paid in 12 equal monthly instalments.

Her employment contract stated that she was entitled to the ‘usual school holidays’ as ‘holidays with pay’. However, she only ever worked during the school terms.

Ms Lloyd brought a claim for unlawful deduction of wages under the Employment Rights Act (1996), stating that she had been paid below the national minimum wage level.

The issue the ET had to decide was whether her basic hours should be calculated over 52 weeks (this was Ms Lloyd’s position), 40 weeks (the school’s position), or over some other period.

ET findings

The ET dismissed the claim. It held that, for the purposes of regulation 21(3) of the National Minimum Wage Regulations, her basic hours were based on 21 hours over 40 weeks. In coming to this conclusion, it noted that Ms Lloyd never worked during the school holidays. Therefore, it concluded that the 40 weeks comprised the 36 weeks during the school terms plus statutory leave entitlement of four weeks, under the Working Time Directive.

Ms Lloyd appealed, stating that the ET should have determined her basic hours by referencing the wording in her contract.

EAT findings

The EAT disagreed with the ET and held that in determining Ms Lloyd’s basic hours, the wording in her employment contract needed to be considered. This wording meant that hours which were not working hours could be included in the calculation. This means that, where a salaried worker is contractually entitled to receive normal salary for a period of absences, those periods of absence from work could count towards basic hours, even if they were absences from a period when a worker would not otherwise be working.

Therefore, the EAT concluded that the ET had erred in focusing on the weeks Ms Lloyd actually worked, rather than identifying her basic hours from her contract.

The EAT remitted the case to a different ET to determine Ms Lloyd’s basic hours.

Summary and advice

This case demonstrates the importance of a detailed and precise contract of employment, including:

  • Clarity on how the salary calculation is made.
  • Detailing clearly any requirements for working during school closure periods.
  • The amount of any paid annual leave and when this should be taken.

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