I have processed the payroll end of year for one client, submitted the P35 and had processed two leavers and printed their P45s to give them. Their date of leaving was 31/03/2013. I have now discovered that they should have been paid accrued holiday pay when they left and I did not do this. One of them had been on SMP for 7 months of the client's leave year so I assume that she would be due 7/12's of her holiday entitlement when she left. What do I do about this? Any help gratefully received!
Edit: Just realised that the employee that was receiving SMP....her holiday entitlement was based on the number of hours she worked across the year (she was a teacher so she taught various courses of differing lengths (38, 36 and 40 weeks). How do I work out her holiday entitlement if she hasn't worked any hours this holiday year (September - August)? She started maternity leave two months before the beginning of the leave year in September 2012.
-- Edited by Stardoe on Thursday 2nd of May 2013 05:25:45 PM
Loads of challenging questions here so please take my comments as discussion only. As this Accrued Holiday Pay had been omitted i would tend to handle the matter as a consultation with the employee. As you will know, it's a legal minefield so I would slightly err and round-up on the side of the employee to avoid potential costs in time and legal fees.
I should think this needs clarifying :- " her holiday entitlement was based on the number of hours she worked across the year ". As you've said, it is less than helpful because she didn't have any hours. Is there anything else in the contract? If no, the fall back position must be the statutory one (average of the last 12 weeks). I take it as a simple SMP at £135.45.
We know she works an average 38 week year. Therefore 100 / 52 * 38 = 73.1% of the year.
The maximum Statutory Holiday Pay is capped at 28 days. Coincidentally a 5 day week @ 5.6 equals the cap of 28. 73.1% of a 5 day week is a 3.66 day week, so I imagine she would accept a holiday pay calculation based on that - 3.66 x 5.6 = 20.5 days a year.
or 28 * 0.731 = annual entitlement 20.5 days
Average £135.45 (SMP) per week / 3.66 = £36.89 per day x 20.5 days = £756.15 Accrued Holiday Pay.
Which I think would be in line with the 2002 ruling on Maconnachie v Leisure Leagues UK Ltd.
The quote at the top would seem to only be relevant to any entitlement carried forward. Usually c/f is a maximum 1.6 weeks but check the pregnancy does not impinge on that rule.
" .......that she would be due 7/12's of her holiday entitlement when she left " Had she already taken the other 5/12ths entitlement before beginning maternity leave?
Many thanks for attempting a reply..lol My client was taking some advice from Peninsula Business Services who she pays for advice monthly, so I'll see what they come up with.
I'm not sure what's in her contract as I haven't seen that. I said 7/12's of her holiday entitlement before I realised that I wouldn't know what her holiday entitlement was as she hadn't worked any hours during the year (the 7/12's as she left after 7 months of the holiday year...September to March). So we can ignore that. I agree that it will probably come down to a consultation between the employee and my client. I'll let you know the outcome.
