UK's 1.7m temporary workers at risk of losing their holiday pay
The UK's 1.7m* temps are at risk of being scammed out of their holiday pay, as witnessed by the recent actions of Workwell, formerly JSA Group, one of the country's largest umbrella companies.
Temporary workers in the UK are often employed by umbrella companies so that they receive one consolidated pay packet whilst working for several different businesses simultaneously.
Evidence is available** that shows one of the UK’s largest umbrella companies, Workwell (formerly JSA Group), has been deliberately withholding holiday pay from one of its workers — holiday pay that the employer in question has already paid to JSA Group.
Workwell argues that, because the holiday was accrued in a previous holiday year, but because the worker did not request the holiday in time, it cannot now be paid to him. The evidence shows that the worker has had £2,865.50 holiday withheld and the arguments that he has put to Workwell when seeking payment, namely that:
- The engagement email (that the contractor received when he joined JSA Group in 2020) does not mention loss of holiday pay
- The “Working with JSA Guide” (that the contractor received when he joined JSA’s umbrella) does not mention loss of holiday pay
- The contractor was not contacted in September 2020 when the loss of holiday pay was imminent
- Payslips from period 27 onwards (i.e. after the end of the holiday year) continued to show a holiday accrual, which Workwell (JSA Group) say is not available.
Workwell's response is that “there is no entitlement, contractual or otherwise, to receive a payment instead of taking annual leave” and that there is no right to carry over holiday entitlement from one holiday year to another.
Their stance is all the more surprising given that the business that engaged the worker has paid Workwell for his statutory holiday in the expectation that it will be duly passed on.
In February 2022, the Pimlico Plumbers holiday pay tribunal was published***. It concluded that the right to paid holiday does not lapse but carries over and accumulates until termination of the contract, at which point the worker is entitled to a payment in respect of untaken leave.
Though this decision relates to a specific case (Smith v Pimlico Plumbers), if this judgement is applied widely and deemed to be a precedent, it could mean that workers have a case for receiving backdated holiday pay.
Julia Kermode, founder of IWORK, commented:
There are many umbrellas within the sector who have taken the moral decision to always pay holiday to their contractors, and yet a behemoth such as Workwell does not appear to feel the same obligation. Restrictive preferred supplier lists mean that workers often have little choice when it comes to selecting an umbrella company and may be forced to use firms who are not operating in their best interests. This is fundamentally wrong and workers could lose out financially as a result. Such preferred supplier lists should be banned and workers should be empowered to make an informed choice about which umbrella firm they want to work with."
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Notes to editors
*Source for 1.7m temporary workers: ONS data published 15 February 2022
** Evidence
*** Smith v Pimlico Plumbers tribunal
About IWORK
Championing Independent Work, IWORK provides many resources to support and protect independent workers who are the lifeblood of the UK's economy in all industries. From temps who provide vital support when needed, to self-employed freelancers bringing their skills to businesses, to consultants and interims working on projects, to entrepreneurs and disrupters. IWORK’s founder, Julia Kermode, has many years of expertise and is a well-known commentator in the contracting sector who is regularly called on to contribute to government policy-making. She is now on a mission to empower the UK’s independent workers so that they get the fair deal they deserve.