The Employment Appeals Tribunal has handed down an important decision dealing with the national minimum wage legislation in Commissioners for HM Revenue and Customs v Leisure Employment Services Ltd.
The employer (part of the Butlins group) supplied accommodation to employees working at holiday camps. As part of the arrangement, the employees consented to a deduction of £6 per fortnight as a contribution towards the cost of gas and electricity.
If this £6 per fortnight could be counted as part of the employees' wages, then the employer complied with the minimum wage legislation. However, if it had to be deducted when calculating the wage paid, then the employees received less than the minimum wage.
In a complex judgment, the Employment Appeal Tribunal held that the employer could not count the £6 per fortnight towards the employees' wages, and was thus in breach of the national minimum wage legislation. This will have significance for employers that offer living accommodation to employees and should put them on alert regarding related deductions from wages.