The Court of Appeal has today handed down judgment in the keenly-awaited case of Lock v British Gas [2016] EWCA Civ 983. The question in Lock was whether employers have to take into account results-based commission when calculating holiday pay. The Court of Justice of the European Union had said, at an earlier stage in the Lock proceedings, that the Working Time Directive requires results-based commission to be taken into account, and the issue for the Court of Appeal was whether UK law could be read in conformity with EU law in this respect.
The Court of Appeal held that a normal interpretation of UK law would lead to the conclusion that results-based commission should not be taken into account, but that domestic law should be read in line with the Directive unless it would go against the grain of the domestic legislation to do so. The key question, therefore, was whether an interpretation of the domestic law that required results-based commission to be taken into account for holiday purposes would go against the grain of the domestic legislation. The Court said that it did not find the question easy but concluded that it would not go against the grain of domestic legislation for it to be interpreted so as to mean that results-based commission should be taken into account. The Court therefore dismissed British Gas’s appeal.
The Court of Appeal also upheld the ruling of the Employment Appeal Tribunal in Bear Scotland v Fulton and another [2015] ICR 221 to the effect that employers must also take non-guaranteed overtime into account when calculating holiday pay.
John Cavanagh KC acted for British Gas in this appeal.
Click here to read this judgment.
