The holidays are over. But did you get enough holiday pay? — Paul Evans’ industry blog

A few Directors UK members have been in touch with me to express frustration about a widespread industry position on holiday pay. To them, it looks very penny-pinching, especially in the context of our current employment climate.

The Producers Alliance for Cinema and Television (Pact) published a briefing in May, following a legislative clarification that supported the use of a 12.07% figure for topping-up freelance rates of pay to cover statutory paid holidays. Under the cover of careful caveatage, the guidance Pact provides seems designed to double down on the very odd figure they’ve always used – 10.77%.

Why 10.77%? It looks to me like the product of a logical fallacy. I won’t bore you with the maths (though I can’t help adding some more detail at the bottom of this page) but the shortest explanation would be that, if you take 28 days holiday in a year that has 260 working days (5 x 52), you take 10.77% of your year in paid holiday.

However, the calculation a payroll should really consider is what the relationship is between the actual time worked (as opposed to the time contracted) and the amount of holiday due. If you work 232 days, you need 28 days of additional paid holidays to get to the magic 260 figure. 28 is 12.07% of 232.

You can check the table further down the page for more examples of what you should be entitled to.

Pact’s briefing makes two odd claims:

1)    Where employers are employing people on non-irregular/part year contacts, they can choose not to apply the 12.07%, and sometimes opt for their 10.77% figure instead. 
2)    That most crew are not part-year workers and/or people who are employed on irregular hours

On that first point, their wording is very interesting in answering their own FAQ: “Can I continue to use 10.77%?”

They say that the legislation “does not state that accruing holiday pay at 10.77% or using any other method of calculating holiday pay (such as a non-percentage-based method) is unlawful.”

I suppose that is correct in a very legalistic sense, because many employment rights including holiday pay rules are very difficult to enforce legally. But it’s largely moot anyway, because of their second claim. I believe Pact are wrong to say that most crews are not irregular and / or part-year hires. Most of these engagements last for less than 12 months and in some cases, crews are working on multiple and overlapping contracts.

Pact’s own scripted agreements with Bectu are full of provisions for overtime, Compensatory Rest, penalty payments for broken lunchbreaks, sixth and seventh day rates, 11-day fortnights, night payments, etc. These are people who expect to work different hours and take home a different size of wage packet each week.

In the unscripted areas, many employment contracts are also not full-year deals. They may sometimes formally be for fixed hours, but many of the terms are de-facto buy-outs (i.e. loads of unpaid overtime, therefore the real hourly rate is different from day to day).

If such an employer uses any flat figure lower than 12.07%, there will probably be people who receive less than 5.6 weeks holiday pro-rata.

But let’s park the legal nit-picking for a moment. It largely misses the important point.

Our industry’s freelancers make huge sacrifices. They work gruelling schedules if there is work to do – and suffer in silence during the downturns. Their opt-out of the 48-hour working time rules alone should come with some holiday bonus. Many employers (including many Pact members) offer their own permanent employees significantly more than the statutory minimum of 5.6 weeks in a year, and it seems inappropriate to me that any industry body in such circumstances would appear to be so concerned to encourage employers to shave very small amounts off freelancers’ already-thin package of employment benefits.

If anything, 12.07% should be the starting point of the negotiation. But either way, a clear and unequivocal briefing that a figure of 12.07% (or let's be even more lavish – round it up to 12.1%!) will ensure that employers are not paying less than the absolute legal minimum holiday pay. Anything other than that looks tight. It’s symbolic of a very uncaring attitude to freelancers that resonates on dozens of online crew forums.

Outside our industry, most employers have always used 12.1%. The BBC and ITV use it, and now, because some directors have kicked up a fuss about it, I’m hearing that a growing list of employers in our sector are also committing to it.

I have contacted Pact and asked them to redraft their advice but they won’t do so. In my view, it is particularly unacceptable to continue including the 10.77% figure – it appears to be a baseless red herring that will continue to attract criticisms from directors and everyone else as far as I can see.

Paul Evans is Head of Industry Relations at Directors UK. In this regular blog Paul shares his thoughts on the industry, as he meets and collaborates with directors across the UK. Read Paul’s previous blog: “When they say “jump”, we say “how low?”.

Check the table below for more information on what holiday pay you should be entitled to.