Precedents Cited

The judgment referenced several key precedents that influenced the Court's decision:

• Russell v Transocean International Resources Ltd [2011] UKSC 57: Confirmed that employers can mandate leave during periods when employees are not required to work.
• QH v Varhoven kasatsionen sad na Republika Bulgaria (C-762/18): Highlighted the importance of the right to paid annual leave and limitations to prorating based on actual work performed.
• Dicu (C‑12/17) and Dominguez (C‑282/10): Established that certain conditions, like unlawful dismissal or sickness, prevent prorating of leave entitlements.
• Hein v Albert Holzkamm Gmbh & Co KG (C-185/17): Demonstrated the CJEU's stance on prorating holiday pay while maintaining the rise in holidays can be allowed under EU law.
• Greenfield v The Care Bureau Ltd (C-219/14): Emphasized the necessity to recalculate leave entitlements when a part-time worker increases their hours.
• BECTU v Secretary of State for Trade and Industry (C-173/99): Affirmed that leave can be taken in full at the start of the leave year, irrespective of hours worked.

These precedents collectively reinforce the Court's interpretation of the WTR, ensuring that leave entitlements align with the protections afforded under EU law.

Legal Reasoning

The Supreme Court's reasoning hinged on the distinction between the calculation of the amount of holiday pay and the duration of holiday entitlement. While regulation 16 of the WTR mandates that holiday pay be calculated using an average week's pay derived from the preceding 12 weeks (as per section 224 of the Employment Rights Act 1996), there is no equivalent provision for prorating the duration of leave based on actual work performed.

The Harpur Trust argued for the "conformity principle," suggesting that annual leave should be prorated in proportion to the time a part-year worker actually spends working. However, the Court found that this principle was not embedded within the WTR's framework concerning leave entitlement. The regulations explicitly provide for time-based apportionment (regulations 13(5) and 13A(5)) rather than work-based calculations for determining leave duration.

Moreover, the Court observed that allowing prorating based on work performed would introduce inconsistencies in the statutory scheme and undermine the intended protections of the WTD. The Harpur Trust's alternative methods, such as the "Percentage Method" and the "Worked Year Method," were deemed incompatible with the statutory language and the established calculation framework.

Impact

This landmark judgment has several far-reaching implications:

• Clarification of Leave Entitlements: Establishes that part-year workers under permanent contracts are entitled to the same minimum annual leave as full-time workers, eliminating the need for further prorating based on weeks worked.
• Consistency in Employment Law: Reinforces the uniform application of the WTR, ensuring that calculations for holiday pay and entitlement are distinct and follow their respective statutory provisions.
• Guidance for Employers: Provides clear directives for employers on how to calculate and grant leave entitlements, reducing ambiguity and potential disputes.
• EU Law Compliance: Affirms that UK domestic regulations, even post-Brexit, continue to align with EU directives retroactively, particularly in areas retained under the Withdrawal Act.
• Precedent for Future Cases: Sets a binding precedent for lower courts and future litigations concerning holiday entitlements of irregular or part-year workers.

Overall, the judgment upholds workers' rights to fair and consistent annual leave entitlements, reinforcing the protective framework established by the WTD and its UK implementation through the WTR.