The Supreme Court has dismissed an appeal to a landmark holiday pay ruling that was brought by the PSNI Chief Constable and NI Policing Board.
The appeal concerned the entitlements of PSNI officers and civilian staff when claiming holiday pay.
Lawyers estimate the class action brought by 14 claimants on behalf of some 3,700 officers and support workers will cost the PSNI around £30million.
They had been paid their basic salary when off on holiday leave, which the Court of Appeal ruled was an unlawful deduction, as it should reflect their overtime and allowances which would appear in a workers' "normal pay".
The appellants accepted that the calculation and payment of holiday pay as basic pay instead of normal pay amounted to making an unlawful deduction from wages and a failure to pay holiday pay in full.
However, they contested how far back any remedies by repayment should go.
The argument therefore centred around how many years of back-payment the claimants are legally entitled to claim for.
The PSNI were relying on a provision in an EU Working Time Regulation which would have restricted the officer claimants to claiming holiday pay sums relating only to the three months before their claim started in an Industrial Tribunal.
The claimants were relying on a different provision in the Employment Rights (NI Order) 1996, which said they could claim for underpayments arising from a series of payments provided the last underpayment in the series was not more than 3 months before the industrial tribunal heard their claim.
This would mean their claims could cover many more holidays they took in previous years, which would be substantially higher. This is referred to as the "series extension".
Lady Rose ruled in favour of the claimants.
Delivering the judgement, Lady Rose said: "The general purpose of the legislation under consideration is to protect workers against exploitation and particularly to protect vulnerable workers from being paid too little.
"The series extension in particular protection against the operation of the short, three month limitation period, for a worker who suffers repeated but small deductions from their wages.
"Likewise, the court holds that a correct payment of holiday pay does not necessarily bring a series to an end.
"In this case, the Court of Appeal was right to find that each unlawful underpayment was linked by the common fault that holiday pay had been calculated by reference to basic pay only.
"The Supreme Court therefore unanimously dismissed the appeal."
Niall McMullan of Edwards and Co Solicitors spoke to UTV from the Supreme Court.
He said that not only is this ‘is a resounding and emphatic outcome’ for almost 4,000 PSNI officers he represents in the long-running holiday pay case, but it could have far reaching implications for all workers.
John McShane, Partner Solicitor with McCartan Turkington Breen, represents nine of the eleven police officers and two civilian staff claimants.
"This ruling by the Supreme Court affirms that the PSNI's failure to include overtime in holiday pay calculations amounts to an unlawful deduction from wages," he said."The Chief Constable's failure to pay staff in accordance with the legal requirements, resulted in the need for police officers and civilian staff to incur the cost of pursuing legal proceedings to seek redress for their lawful entitlement to be properly paid whilst on annual leave.
"It is disappointing that this group of workers were forced to pursue this process but I am delighted that they will now finally receive the pay they deserve. We hope this case contributes to a 'step-change' in the way organisations calculate holiday pay moving forward so that individuals can be safe in the knowledge they are being fairly renumerated for their hard work and dedication."
Antoinette McMillen is Deputy General Secretary of the Northern Ireland Public Service Alliance.
“NIPSA stands at the forefront of the ongoing struggle to ensure that every worker receives their rightful pay," she said.
“NIPSA members will be delighted with the outcome. Individual workers cannot afford this sort of litigation but being part of a trade union allows workers to challenge paying justices through such legal cases.”
PSNI Assistant Chief Officer for Corporate Services Mark McNaughten said: “The Police Service of Northern Ireland acknowledges today’s important judgment of the UK Supreme Court and welcomes the clarity it brings to some complex legal issues.
“This appeal was progressed in order to seek a definitive ruling from the Supreme Court on difficult points of law and to help ensure that our officers and staff are fairly remunerated in line with our legal obligations.
“We will now take time to study today’s judgment in detail, consider the implications and how the costs will be met.”
PFNI Chair, Liam Kelly, said "it might have been more prudent, and certainly more cost-effective, if the PSNI had accepted our position at first instance and laterally the Court of Appeal judgement in Belfast without taking this case to the Supreme Court."
“This is the end of the road for PSNI legally, their appeal has been resoundingly dismissed so the remedy process can now recommence," he said.
“There remains the issue of what officers are actually owed, and that will have to be decided via the Industrial Tribunal. Past underpayments will have to be made good and eligible officers compensated for loss of wages when they have availed of annual leave. That work will undoubtedly take some time to complete, so officers shouldn’t expect to see what they are owed appearing in their payslips anytime soon.
“This is the most significant legal milestone in what was a seven-year campaign. Our men and women should warmly welcome this Judgement. They have been found to have the same entitlements and protections enjoyed by all workers under employment law. At some point in the future, they can look forward to getting what they are rightly owed.”
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