『Term-time worker entitled to National Minimum Wage for 52 weeks』のカバーアート

Term-time worker entitled to National Minimum Wage for 52 weeks

Term-time worker entitled to National Minimum Wage for 52 weeks

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 In this article, Glenn Hayes looks at the issue of paying staff on term-time only contracts through the lens of the Lloyd v Elmhurst School Ltd case. He discusses the background, implications and offers some top tips for schools and colleges.Schools and colleges employ staff on term-time only contracts to reduce their payroll costs. The vast majority agree to work during term-time (generally around 39 weeks a year in the state sector) and are paid a pro-rated salary to reflect this, which is then divided by 12 and paid monthly. Employees like this arrangement because it means they receive a regular wage, even when they are not required to work. It’s also administratively convenient for employers.Under the National Minimum Wage Regulations, workers must receive the NMW for the hours they work in a ‘relevant pay period’ (how often they are paid). To avoid HMRC concluding that term-time workers have been underpaid during their periods of work, their contracts have to comply with the detailed rules about salaried hours workers.In Lloyd v Elmhurst School Ltd, the EAT had to decide if a teaching assistant whose contract didn’t set out the number of hours she was required to work, and contained a clause which said she was ‘entitled to the usual school holidays as holidays with pay’, had been underpaid because she only received four weeks holiday pay. BackgroundMs Lloyd started working for the Elmhurst private school in 2009. The parties agreed that she would work term-time only and that she would be paid for 40 weeks a year (which included four weeks’ holiday) payable in twelve monthly instalments. However, the contract terms did not accurately reflect that agreement. It stated that Ms Lloyd:‘May be required to work for varying short periods at the end and before the beginning of term’‘Was entitled to the usual school holidays as holidays with pay’Ms Lloyd worked under that arrangement for a number of years. However, for reasons that aren’t explained, she later brought a tribunal claim arguing that she was entitled to be paid for each week of the school holidays in accordance with her contract and, therefore, hadn’t received the NMW. The school argued that it had paid her correctly and that her salary exceeded the NMW.The tribunal dismissed her claim and said that her ‘basic hours’ were based on 21 hours over 40 weeks which comprised the 36 hours she worked during term-time and four weeks leave. That was the arrangement agreed between the parties, albeit not reflected in the contract. Ms Lloyd appealed. Decision of the EATThe parties agreed that Ms Lloyd was engaged on a salaried hours contract and the EAT proceeded on that basis. The key question it had to determine was whether the tribunal had properly interpreted the rules that applied to working out the ‘basic hours’ of a salaried hours worker. The EAT said that the tribunal had got this wrong. The relevant provisions of the NMW Regulations (21(3)) don’t refer to working hours at all – but to ‘basic hours’. And these can include contractual hours which the worker doesn’t have to work as well as, paid contractual holiday. Ms Lloyd’s basic hours had to be ascertained from her contract – not from the number of hours she actually worked. Her contract clearly stated that she was entitled to be paid during the ‘usual school holidays’. The court couldn’t imply a term into the contract that the reference to paid holiday was limited to the amount of holiday she was entitled to under the Working Time Regulations 1998 and how much she had received. By not paying her for all of those holiday weeks, the claimant’s pay for her ‘basic hours’ fell below NMW rates. The EAT remitted the claim back to the tribunal to determine how much Ms Lloyd had been underpaid.It’s interesting that, prior to Ms Lloyd’s tribunal claim, HMRC had investigated the school. It found that term-time staff at the school were paid for a 40-week period and that the school hadn’t underpaid them. HMRC’s findings aren’t bi...
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