More than 200 Ryanair pilots are reportedly bringing holiday pay claims against the airline. The dispute is over whether they received the correct level of pay while taking annual leave.

The claims raise an important issue that extends far beyond the aviation industry. Workers should generally not be financially disadvantaged simply because they take their statutory leave entitlement.

For UK employees and workers, understanding how holiday payment is calculated can be important, particularly where earnings include commission, regular overtime or other payments in addition to basic salary.

So, why is Ryanair facing claims from hundreds of pilots? We dive into this and what UK workers should know about their rights to holiday pay.

Why Is Ryanair Being Sued?

According to reports, more than 200 Ryanair pilots have brought claims against the airline concerning the calculation of their holiday pay. At the centre of the dispute is whether pilots were paid the correct amount when taking annual leave.

The issue is significant because a worker’s holiday pay may need to reflect more than their basic salary. Depending on the worker’s circumstances and the type of statutory leave involved, elements such as regular overtime, commission and certain other payments can form part of the calculation.

Read More: Over 12,000 Bolt Drivers Take Cab Company to Court Over Employment Status and Unpaid Holiday Pay | Redmans Solicitors

Government guidance states that “normal” pay for statutory holiday purposes can include commission, regular overtime payments and payments relating to length of service or professional qualifications.

This principle is particularly relevant to pilots.

In the 2011 Williams v British Airways case, the European Court ruled that pilots’ holiday pay should not be limited to basic salary. Payments intrinsically linked to performing their contractual duties, as well as certain payments connected with their professional or personal status, may need to be reflected in holiday pay. The current claims will therefore be important in determining whether the pilots bringing the proceedings received their holiday pay entitlements.

It is important to stress that these are claims being brought against the airline. The allegations have not, merely by virtue of the claims being issued, been established as findings against Ryanair.

Why Does This Matter to UK Employees?

The Ryanair dispute highlights a broader principle of UK employment law. Eligible workers have a right not only to take statutory annual leave but also to receive the appropriate holiday payment when they take it.

For most workers, the statutory minimum is 5.6 weeks of paid annual leave each year. For someone working five days per week, this will usually equate to 28 days, and including bank holidays within that allowance is usually an employer’s discretion.

An employment contract can provide more generous annual leave rights. However, it cannot generally reduce a worker’s statutory entitlement below the legal minimum. Importantly, the right to statutory paid annual leave is not restricted to traditional full-time employees.

Full-Time Employees

A full-time employee working five days per week will generally be entitled to at least 28 days of statutory paid annual leave each year, equivalent to 5.6 weeks.

Read More: Can an Employer Cancel Annual Leave in the UK? | Redmans Solicitors

The employer can include bank holidays within those 28 days rather than providing them on top of the statutory entitlement. However, an employment contract may provide additional leave.

For regular-hours workers receiving fixed pay, a week’s holiday pay will normally correspond to what they would receive for a normal working week. For the first four weeks of statutory leave, however, “normal” remuneration can be relevant.

Government guidance states that this can include commission, regular overtime and certain status-related payments. The remaining 1.6 weeks can generally be paid at the worker’s basic rate.

Part-Time Employees and Workers

Part-time workers are also entitled to 5.6 weeks of statutory paid time off. However, their entitlement will reflect the number of days or hours they normally work.

For example, someone who regularly works three days per week would ordinarily be entitled to:

3 days × 5.6 weeks = 16.8 days of statutory annual leave.

This ensures that part-time workers receive the same proportionate statutory entitlement as comparable full-time workers.

Irregular-Hours and Part-Year Workers

Different rules apply to workers whose hours are wholly or mostly variable and to qualifying part-year workers.

For leave years beginning on or after 1 April 2024, statutory holiday entitlement for irregular-hours and part-year workers generally accrues at 12.07% of the hours worked during each pay period, subject to the applicable rules on rounding and statutory limits.

Employers can also use rolled-up holiday pay for qualifying irregular-hours and part-year workers. Under this method, holiday pay is generally calculated at 12.07% of the worker’s total pay for the relevant pay period. This is then paid alongside their wages, rather than when the leave itself is taken. Ideally, it should be identified separately on the worker’s payslip.

Rolled-up holiday pay is not generally permitted for regular-hours workers.

What About Zero-Hours and Casual Workers?

Being on a zero-hours or casual contract does not automatically mean a person has no right to paid annual leave.

Workers with irregular hours can still qualify for statutory paid time off. Their entitlement and holiday pay will depend on their working arrangements and the applicable rules for irregular-hours workers.

Read More: ACAS Proposes Changes to Formal Grievance Procedures Encouraging Informal Resolution | Redmans Solicitors

This means an employer should not assume that someone is excluded from holiday rights simply because they do not work a conventional Monday-to-Friday schedule.

Are Airline Pilots Different?

There is an important distinction when discussing the Ryanair holiday pay claims case.

Certain workers in sectors including civil aviation are subject to separate working-time rules. Our holiday guide notes that airline crew members are entitled to annual leave under separate regulations, rather than relying solely on the general Working Time Regulations 1998, which apply to many other workers.

Hence, the Ryanair pilots’ particular legal position should not automatically be treated as identical to that of every UK employee.

Nevertheless, the dispute highlights the broader importance of calculating holiday pay correctly.

How is Holiday Pay Calculated?

There is no single calculation that applies identically to every worker. Workers with regular hours and fixed pay usually have holiday pay reflected in their normal weekly pay.

For shift workers with regular hours, government guidance uses the average number of weekly fixed hours worked during the previous 52 weeks at the worker’s average hourly rate.

For irregular-hours and part-year workers, the applicable calculation can involve average pay over the relevant 52 paid weeks or, where the statutory conditions are met and the employer uses the method, rolled-up holiday pay.

The key principle is that workers should receive the holiday pay to which they are legally entitled. Moreover, they should not be discouraged from taking annual leave as doing so would improperly reduce their income.

Holiday Pay FAQs

How Far Back Can I Make a Claim for Holiday Pay?

Employees should act promptly if they believe they have been underpaid because strict Employment Tribunal time limits apply.

For an unlawful deduction from wages claim involving a single incorrect deduction, the usual time limit is three months minus one day from the date of the deduction.

Where there has been a series of linked deductions, the usual deadline is three months minus one day from the most recent deduction. In Great Britain, a worker can generally recover deductions going back a maximum of two years, provided the legal requirements for a series of deductions are satisfied.

Acas Early Conciliation can affect the calculation of the tribunal deadline. So, employees who believe they have a claim should consider obtaining advice promptly.

The position can also differ between Great Britain and Northern Ireland. The Supreme Court’s decision in Chief Constable of the Police Service of Northern Ireland v Agnew has particular significance for Northern Irish holiday pay claims, while the two-year statutory backstop continues to affect relevant claims in Great Britain.

Am I Entitled to Holiday Pay if I Work Part-Time?

Yes, qualifying part-time workers are entitled to statutory paid annual leave.

The entitlement is proportionate to their working pattern. Someone working three days per week, for example, would generally receive 16.8 days of statutory leave per year.

Part-time status should not, by itself, prevent a worker from receiving statutory pay for holiday.

Can My Employer Refuse My Holiday Request?

An employer can refuse a request to take annual leave on particular dates, provided it follows the relevant notice rules and any contractual arrangements.

However, an employer cannot simply prevent a worker from taking their statutory minimum annual leave altogether.

Employers also have obligations concerning opportunities to take leave. Government guidance provides for carry-over of leave in certain circumstances where workers were not given a reasonable opportunity to take it or were not properly informed that untaken leave could be lost.

Do I Still Accrue Holiday While on Sick Leave?

Statutory holiday entitlement can continue to accrue while a worker is off sick.

There are also rules allowing workers to carry over statutory leave where sickness prevented them from taking it. The precise amount that can be carried forward can depend on the worker’s working arrangements and the type of statutory leave involved.

An employee may also request to take annual leave while they are on sick leave. If the employer approves the request, the relevant period would be treated as holiday, and the employee should receive the appropriate holiday pay.

What Should You Do if Your Holiday Pay Is Wrong?

Workers who think their holiday payment has been calculated incorrectly should first check their employment contract, payslips and annual leave records.

It can be useful to compare what you normally earn with what you received during periods of annual leave, particularly if your usual earnings include commission, overtime, allowances or other regular payments.

The next step may be to raise the discrepancy with the employer or payroll department. If it cannot be resolved informally, the employee may consider raising a formal grievance.

If the dispute remains unresolved, an Employment Tribunal claim for unlawful deductions from wages or another appropriate cause of action may be available depending on the circumstances.

Employees should pay particular attention to the applicable time limit. Waiting for an employer to investigate a complaint does not necessarily protect a tribunal deadline.

Why the Ryanair Holiday Pay Claims Matter

The claims brought by more than 200 Ryanair pilots highlight how important the calculation of pay for holiday can become where an employee’s normal earnings involve more than basic salary.

The legal principle behind paid annual leave is not simply that workers should be permitted to stay away from work. Eligible workers should also receive the holiday pay to which they are legally entitled.

For millions of workers, the UK annual leave entitlement provides a minimum of 5.6 weeks of paid leave each year. However, how that entitlement and the corresponding pay are calculated will depend on factors including employment status and working pattern.

Anyone who believes their employer has consistently underpaid their holiday entitlement should consider checking their records and obtaining advice quickly.

As the Ryanair litigation demonstrates, disputes over holiday pay can involve substantial numbers of workers. They also raise important questions about which elements of remuneration should continue to be reflected when employees take their statutory paid time off.

Get Help with Redmans

If you believe you have been underpaid for your annual leave or your employer has incorrectly calculated your holiday pay, contact Redmans Solicitors. Our employment law specialists can assess your circumstances, explain your rights and advise you on whether you may be able to pursue a holiday pay claim.

It only takes a moment to learn more about how we could help, simply:

• Call us on 020 3397 3603
• Fill out our online form to request a consultation