A question about : Holiday Pay and redundancy
Hope someone can give me advice.....
On Friday 30th Jan 09 I was called into a meeting with my boss and a HR person to be told the company had to save cost's and my job was at risk of redundancy. I received at the meeting a letter from HR outlining this and told to attend a consultation meeting on 4th Feb 09. They state in the letter tha We envisage the consultation period will last 30 days with approx one consultation meeting per week
My question is.....our holiday begins on March 1st and runs to February 28th of the following year, so if they terminate my contract before March 1st, I will not receive my full entitlement to next years holiday which would amount in money terms to around Ј2,500 to me.
I wasnt sure so I have seen my doctor and he has put me on sick with flu for one week, hopefully so when i go back on the 9th Feb I will still have the full 30 days (4 weeks) of consultation before they can terminate my contract. As I have been with the company for 32 years, I will receive the full 3 months notice too.
Hope someone can tell me if im doing the right thing here, because my job is so unique I really cant argue with the redundancy claim as my workload had decreased over 50% in the lastyear
many thanks to all that can help
Best answers:
- You don't get holiday entitlement up-front as such. So if you worked one month into your next holiday year and then leave you would not be entitled to the full year's holiday, just one month's-worth of it. So if you normally get 24 days a year, and took one day holiday during that month before leaving, yiou'd be entitled to just one day's holiday money.
Something else to be aware of if you get paid money in lieu of notice ... it caught me out. I was entitled to 3 months notice but left immediately, so got paid 3 months wages in lieu. But the taxman sees that simply as a big fat bonus in your final pay cheque, and taxes the whole lot as such - forget about any tax allowances you would have got if the money was paid normally across the next 3 months! Can make quite a big difference, and none of the advice we received told us about that. Really bugged me. - If you don't work the full year, you won't be entitled to a full year's paid holiday entitlement, only to the proportion accrued.
- all depends if your holiday is accrued as you work the year. you need to find your employment contract or a staff handbook and check how your holiday is worked out
- reheat, you would still get your 3 months tax allowance. if you stayed off work for the 3 months then found a new job you wouldnt pay tax for the next 3 months.
- Also - as far as I know the consultation period is not put on hold simply because you are off ill? Being off sick for a week won't add a week on to the consultation period - sorry
- Hi there,
Thanks for all the advice folks, here's where I am now, I have been told my consultation will end Feb 27th and unless anything else comes up(offer of employment elsewhere in the company etc) that is when I will leave the company. I am happy with all this to be honest. I have a contracted 3 month notice period and they are going to pay me PILON.
Could someone answer me this question please.......we accrue holidays at approx 2 days per month, and if my notice period is 3 months, should I continue to accrue these holidays even though I will not actually be physically working for them ? Id have thought Im still legally employed by them so they should continue to pay me for holidays i dont take ?
much obliged for any answers please
many thanks - I asked my solicitor the exact same question this morning, and the answer was along the lines of the following:
You can only accrue holidays up until the day you leave. PILON is a compensation for breach of contract, i.e. where the company lets you go without notice, so there will be no notice period in which you can accrue holidays. - I was paid 3 months in lieu of notice when I was redundant and they wanted me to go immediately. I was initially told that I would not accrue any holiday pay for the 3 months, however my understanding of notice pay is that they have to give you your full package for the entire notice period (I was paid something in lieu of my medical cover and my car allowance) so I rang ACAS. the advisor that I spoke to said that he saw no reason not to accrue the holiday pay. When I put this to my employer they caved in and paid the holiday pay (6 days pay is a lot when your have no prospect of future income for a while). Perhaps they just didn't want me to make a fuss but at least I got the money.
May be worth a try. - Hello again,
Bringing you up to date, Ive been given an estimate of my final pay as it looks as though my redundancy will be confirmed for the end of February. Firstly my redundancy payment is exactly what I expected, second they have confirmed PILON to cover the 3 months as stated in my contract and if i sign a waiver that i will have no further claim on the company, an extra moth salary tax free. All this sounds fine to me but then they spoilt themselves by saying i would pay tax/NI on the PILON. Im not sure I agree with that as its really a compensation for them breaching my contract and I would have accrued 6 more day holiday pay if i worked my full notice. So am I right to stand firm and ask for it to be non taxed/NI, and should i be extra cheeky and ask for my holiday pay to be included.
In the end of the day its all i have !!! my last pay for a while . - Sorry I should have said they are wanting me to leave immediately on end of February straight after my consultation period ends.
- DFC - see post #5 re PILON. - LV
- Hi there,
Finally checked my contract, it states "The company reserves the right to terminate this contract immediately without giving the notice required (3 calendar months) by paying to the employee salary (less PAYE deductions) in lieu of notice"
Does this mean a) I should receive 13 weeks PILON instead of the 12 weeks they have offered ? and b) does this mean I should not pay Tax or NI on this PILON either ??
many thanks for all your help .........
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