Last Thursday it was announced that John Lewis underpaid thousands of staff members over the past seven years, in particular those working on Sundays and Bank Holidays.
The error, which has been ongoing since around 2007, occurred as a result of John Lewis failing to implement the UK’s Working Time Regulations legislation correctly.
Calculating holiday pay can be a difficult and confusing process for employees due to these complex regulations, which ought to be reconsidered and amended. If you feel you may have been underpaid, either by John Lewis or another employer, please do not hesitate to contact Robert Holland, head of our dedicated employment law team, on the number below.
To remedy the underpayment, John Lewis has announced it will make what it describes as ‘fair and responsible’ one-off compensation payments to around 70,000 current staff members, at both department stores and Waitrose supermarkets. The award will appear as an additional sum in employee’s next wage. John Lewis also intends to contact ex-employees who left through illness and redundancy. Unfortunately, however, the company has indicated that it will not compensate any ex-employee who left their position voluntarily, no matter their length of service or date of resignation. This means John Lewis are unwilling to re-pay those underpaid who have worked during the whole relevant period, and in some cases even longer, if they resigned, even as recently as this month.
The company has set aside £40m to accommodate the compensation awards, which includes actual payments missed, incorrect national insurance contributions and other expenses. It has been reported that some individual payments to staff may be over £1,000, with approximately half of individual claims being valued around the £120 mark. The amount of each award will depend upon the employee’s pay and shift pattern.
It appears that the compensation has been ring-fenced for current employees and those who had no choice in leaving. People who were dismissed and left on their own seem to have lost out despite the company’s admission of underpayment. If you would like more information or feel you have been affected by this matter, please contact Robert Holland.
To listen to Robert Holland on Radio 4’s Moneybox show discussing this click here