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The CWU announced this week (Tuesday) that it has lodged a formal claim for future entitlements and back pay with Royal Mail following three landmark Employment Tribunal cases regarding the EU's 1998 Working Time Directive.
The cases cast doubt over how an employer is required to calculate holiday pay, with a previous decision from 2004 stating that ad hoc overtime did not need to be included in the calculation.
The most recent cases however, have contradicted this decision and ruled that ad hoc overtime should now be included.
The European court ruled in May in the case of Lock v British Gas Trading Ltd that remuneration must take into account additional payments, including overtime, when calculating employees pay during holiday periods.
Dave Ward, CWU deputy general secretary, said:
"Although these Employment Tribunal decisions are not yet binding, the legal advice received from our lawyers suggests that ultimately, this is likely, though not certain, to be confirmed as the correct interpretation of this particular Working Time Directive."
He explained:
"These decisions could have very significant implications and may mean that for any holiday taken since 1998, current Royal Mail employees may have a legitimate legal claim against the company for up to four weeks worth of overtime payments each year."
Employers across the UK are fervently opposed to the recent rulings and lobbying against this interpretation of the directive.
The CBI has warned that companies could face millions of pounds in compensation bills.
Two of the companies involved in this year's Employment Tribunals are appealing the decision, whilst the third company choose to settle out of court.
Following the next meeting with Royal Mail on this issue, further information will be sent out to members.
Source: CWU HQ Website
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