Working Time / A "Weeks Pay"

The EAT has handed down a decision dealing with the complicated question of what does (and does not) fall within the category where "the employee's remuneration for employment in normal working hours...does vary with the amount of work done in the period". Readers will be aware that, under s221 of the Employment Rights Act 1996, a 'week's pay' is averaged over 12 weeks when the remuneration varies as above but not (normally) otherwise.

A problem has always occurred where workers are paid commission. Does their remuneration vary depending on work done? This is not straightforward, particularly if their working hours and activities do not change, and the question of whether they secured the 'deal' (and hence the commission) is dependent on luck or external factors.

The EAT (Elias P. presiding) held that where pay is related to output, and output is in turn significantly connected with the level of performance, then it can properly be said that pay varies with the work done. Thus in a typical 'productivity' scheme, where remuneration varies depending on output, a week's pay should be calculated by averaging over 12 weeks and not simply pitching remuneration levels at a specific, frozen, single week.

May Gurney Ltd. v Adshead (& 95 others)