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Holiday Pay on Holiday Pay? The “Snowball” Effect Confirmed by the Supreme Court

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This article outlines the Belgium Supreme Court judgement concerning holiday pay of employees whose remuneration is (partially) variable

On 29 June 2009, the Belgium Supreme Court issued an important judgment concerning holiday pay of employees whose remuneration is (partially) variable. The question was the following: Does the single holiday pay on the variable remuneration of the employee and which is paid during the year X, have to be taken into account in the basis of calculation of  the holiday pay of the year X + 1?

In a judgment dated 19 October 2004, the Labour Court of Brussels answered in the negative to this question. The Supreme Court has now overturned this judgment.  According to the Court, the single holiday pay, which is calculated on the variable remuneration, must be considered as being a “remuneration effectively earned.” It must, as a consequence, be taken into consideration for the calculation of the single and the double holiday pay of the following year.

This judgment, which confirmed a previous judgment of the Supreme Court of 15 January 1996, is not safe from any criticism. Indeed, this standpoint does not have the support of the regulatory provisions. Besides, it implies a “snowball effect” that the legislator did not want.

The Supreme Court has now referred the matter to the Labour Court of Mons. A case to be followed!

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