The European Union Court of Justice decided earlier this year that commission payments should be taken into account when calculating a worker’s holiday pay – reversing the approach taken by the UK courts. In addition, a decision on whether voluntary overtime pay should also be included in holiday pay is currently awaited from the Employment Appeal Tribunal. It appears that UK legislation on the calculation of holiday pay conflicts with EU law with potential significant employer liabilities for back pay. Many employers are waiting to see the outcome of the litigation and/or Government legislative action, before deciding how best to address these serious issues.