As a contractor working under an umbrella company in the UK you are legally entitled to statutory employment benefits, including Holiday Pay. Many umbrella company contractors still believe they are in a form of self-employment, unaware of the full employee rights and benefits available to them.
At C4J, we’re here to empower you with knowledge and help you claim what’s rightfully yours. Let’s shed light on the two primary methods of holiday pay distribution for umbrella company employees:
Accrual Method: With this approach, your provider sets aside your holiday pay entitlement until you take time off or cease working through the umbrella company. Unfortunately, some unscrupulous umbrella companies have misused this method, resulting in the wrongful withholding of workers’ holiday pay.
Fixed Advanced Payment: Alternatively, you may receive holiday pay through fixed, advanced payments.
As per the European Working Time Regulations, your annual leave should amount to 5.6 weeks per year, which equates to 28 days, inclusive of bank holidays. Remember, your holiday pay is your hard-earned money and should always be transparently paid to you. If, at any point, your umbrella company has unjustly withheld your holiday pay entitlement, you have a legal claim for unlawful deductions.
A significant legal precedent was set in the case of Gary Smith V Pimlico Plumbers Ltd which summarised.
“If a worker takes unpaid leave when the employer disputes the right and refuses to pay for the leave, the worker is not exercising the right. Although domestic legislation can provide for the loss of the right at the end of each leave year, to lose it, the worker must have had the opportunity to exercise the right conferred by the Working Time Directive.”.
Moreover, it’s essential to note that this right can extend back to 1998 when the European Working Time Directive was introduced, potentially entitling you to compensation for past holiday entitlements.
At C4J, we are currently supporting thousands of claimants and group-action clients in their pursuit of justice. Let us do the same for you. Reclaim your unlawfully withheld holiday pay with confidence and assert your rights as a valued employee of your umbrella company.