Council agrees £4m settlement of dispute over calculation of annual leave

The full council at the Royal Borough of Greenwich has agreed an estimated £4m settlement following a five-year dispute over holiday pay.

The Unison union, which claimed that the case could have a much wider impact beyond Greenwich, said 5,000 part-time cleaners, teaching assistants, catering, administrative, school meal workers and other staff working for the local authority were now in line for payouts that could amount to hundreds of pounds.

The case centred on the council’s failure to calculate the employees’ annual leave properly, the union said. As a result some of the staff had been losing up to five days’ pay a year, it added.

Unison brought employment tribunal claims on behalf of 476 of the term-time only staff, arguing that they had been unlawfully treated less favourably than colleagues owing to their part-time status.

At a full council meeting this week, Greenwich councillors agreed to revise the formula used to calculate the holiday allowance and pay the correct rate, backdated to 1 January 2013.

The problem was first identified in 2012, when a school cleaner noticed she had lost a significant amount of pay when her contract changed from a full year to a term-time only one.

Unison assistant general secretary Christina McAnea said: “This is a victory for all low-paid women working in the public sector. What started out as just one case could soon be having an impact far beyond South East London.

“Laws that began life in Europe have enabled Unison to restore justice and ensure that all part-time workers in the Royal Borough of Greenwich are paid the correct holiday pay for the jobs they do.

“Other employers may have made similar errors with their holiday calculations. If they have, we will be on to them to make sure all term-time staff are paid what they are due.”

While the case brought by Unison only involved 476 workers, the corrected formula and back pay will apply to all 5,000 term-time only staff employed by the council. The union said it understood that the settlement would be paid before the end of the year.

More information on the settlement can be found on the council's website here.