The UK’s temporary workforce of 1.6 million people could soon see a pay rise of “thousands” of pounds.
This follows Government proposals to introduce ‘rolled up’ holiday pay as an option for all workers.
Rolled up holiday pay is a system where a worker receives an extra amount or supplement with each pay slip to cover their holiday pay, rather than only receiving holiday pay when they take annual leave.
If holiday pay is not rolled up, the holiday pay of thousands of temporary workers is unfairly withheld – meaning they could lose thousands of pounds every year.
The amendments are part of the The Government’s wider plans Remove “obsolete” and “burdensome” EU rules from UK law.
Martin McTague, National Chair of the Federation of Small Businesses (FSB), said: “We welcome these sensible changes, achieving balance for workers and clarity for employers. It is good to see the Government cutting through excessive burdens without losing the benefits of regulations.
“We are keen to see a clear, cost-effective and easy system for small businesses to roll out, so these announcements are a vital step forward.”
Umbrella Company Compliance Specialist, PayePass, the news has been welcomed. Chief executive Julia Kermode said: “This is fantastic news. By allowing rolled-up holiday pay, a growing number of part-time and irregular workers in the UK will receive what they are legally entitled to, which could be worth thousands for each worker.
“Eligible temporary workers will receive holiday pay when they are paid, which means they are guaranteed to receive it.
“All too often, these workers do not claim holiday – partly because they do not know they are entitled to it and partly because their holiday pay is unfairly withheld from them. It is no exaggeration to say that hundreds of millions of pounds in holiday pay have gone unclaimed over the years.”
Ms Kermode added: “But now the people who attend have no excuse to get their things legally. Rolled-up holiday pay will help hundreds of thousands of workers pay their bills at a very difficult time.
“It goes without saying that the move to legalize this will also stop those horrible businesses from deliberately withholding it from their workers.”
She noted that while the Government has not announced a timeline for the introduction of rolling holiday pay, “all eyes are on the Budget this month”, and she hopes the Chancellor will set a firm date.
Chancellor Jeremy Hunt will announce the Autumn Statement on 22 November.
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