A crane operator claims five years' back holiday pay with interest and statutory increase from his employer because the employer wrongly excluded overtime when calculating holiday pay. The employer defends itself by arguing that the overtime was not mandatory and therefore does not count. How does the highest court ultimately rule?
Legal framework
The law stipulates that the worker retains the right to pay during his holidays. This provision must be interpreted in accordance with the Working Time Directive. The main point here is that the purpose of the requirement for payment of holiday pay is to place the worker during annual leave in a situation comparable in terms of pay to the situation during periods worked.
Overtime must be included in the calculation of holiday pay if the following conditions are met: there are obligations arising from the employment contract that require the employee to work overtime on a regular basis, and its remuneration constitutes a significant part of the total remuneration he receives for his professional activity.
Court's assessment of situation
The employer emphasises that employees work overtime on an entirely voluntary basis. The statements submitted by the employer paint the picture of overtime available to employees, where those employees are always scheduled on a voluntary basis and with some degree of consultation. The written statement of the employee and three other crane operators show that they consider overtime to be normal and that in practice they experience less consultation on the work schedule. The amount of overtime also suggests that overtime can be considered as inherent to the work. There was a long-standing practice of working overtime and the employee was (always) scheduled for more than 40 hours during the week and on weekends. That the employee voluntarily and in consultation with the schedulers agreed to work overtime means that (having) overtime worked became part of the commitments arising for employer and employee from the contract, so there is a situation where overtime is labour law mandatory. The fact that the employee had the freedom to agree with the employer that he did not want to work (more) overtime or less overtime does not alter the fact that, based on the existing (tacit) agreements and rosters, he did work this overtime. In view of the above, the requirement that the overtime was an obligation of the crane operators arising from the employment contract was met.
The exact number of hours the employee worked overtime fluctuated from year to year and from pay period to pay period, but it was clear that he was regularly scheduled to work overtime. Both parties always assumed the availability of overtime to be worked. These were not just unforeseen run-outs of a single job, but rostered work where the employee was scheduled for more than 40 hours in a week structurally, for years and every pay period. That the employee would (or could) work overtime was therefore always foreseeable to the parties. That he actually worked overtime was common. There are no indications that only some of that overtime would be regular, as the employer still argued.
Compensation for overtime is an important part of the total compensation the employee receives for his work.
Conclusion court
It follows from the above that the conditions for counting overtime pay in the ordinary pay to which the employee is entitled during his holiday have been met. It is therefore right for the crane operator.
Supreme Court ruling
The Supreme Court upheld the trial court's judgment.
It is not the case that overtime only counts when determining holiday pay if the employer can unilaterally force the employee to work overtime and could also enforce it. It is overtime that is part of the work that the employee usually performs in the performance of the employment contract and whose remuneration is a significant part of his salary. In order to place the employee in a situation comparable in terms of remuneration to the situation during periods worked during his annual leave, it is necessary to include such overtime in the calculation of holiday pay.
Note: When calculating holiday pay, you should therefore include the usual remuneration for overtime in the basis. We will be happy to advise you on this.
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