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Voluntary overtime now called into question

The Northern Irish Court of Appeal has dealt with the inevitable issue of whether an element to represent voluntary overtime should be included in holiday day.

The EAT in England decided, in the recent Bear Scotland v Fulton case, that payment for regular non-guaranteed overtime should be included in holiday pay. In Patterson v Castlereagh Borough Council, the NI Court of Appeal has decided there is nothing in principle to stop voluntary overtime being included in holiday pay. This is not the same as saying that voluntary overtime must be included in holiday pay. Non-guaranteed overtime is overtime which the employer is not contractually obliged to give, but when it is give, the employee is contractually obliged to do it. Voluntary overtime is distinguished because there is no contractual obligation on either party to either offer or perform it.

In this case, the NI Industrial Tribunal decided voluntary overtime should not be included because it was persuaded by the Bear Scotland case which said that voluntary overtime should not be included. However, this was an erroneous decision because Bear Scotland did not decide that voluntary overtime should not be included, only that regular non-guaranteed overtime should be. It was silent on voluntary overtime. The NI Court of Appeal pointed out the tribunal’s error, and sent the case back for a fresh hearing, noting that there was nothing in principle to exclude voluntary overtime in holiday pay.

It remains to be seen how a fresh Industrial Tribunal will decide on the matter. Regardless of the result, it is likely that it will be appealed again by the losing party and so further delay any concrete guideline on the issue. Whatever the end result, NI Industrial Tribunals will be bound by the decision.

The bearing of this case on British cases involving holiday pay is questionable because Northern Ireland decisions are not binding here. However, GB Tribunals can be persuaded by NI cases.

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Nicola Mullineux

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