UC and Holiday Pay at end of employment

This concerns an aspect of the Johnson case.

It is not contentious that if a claimant is paid any holiday pay owed when they leave a job this counts as employed income for the assessment period in which it is paid.

The Johnson case raised issues regarding the period for which the income was paid for as distinct from the date it was paid/reported.

If the income was for ongoing wages the dates it was paid for are clear but where does this leave holiday pay after the employment has finished, should it be attributed to the last period of employment or another period?

As I recall ( and I may have misremembered this, I’m getting old!) holiday pay was counted for IS purposes for the period of holiday it was supposed to cover,  if there was two weeks holiday pay then it counted for the two weeks following the last day of employment

I’m well aware that the whole problem can be sidestepped by delaying the UC claim until after the holiday pay has come in but cl’s are not always aware of this tactic and just claim anyway and I was wondering if there were any arguments that might avoid an initial claim being reduced or zero’d by holiday pay.

I’m quite prepared to admit that I’m out on a limb but I would be interested in any observations

I think the starting point for your client is always going to be Reg 54 (and 61): UC will treat it as earnings in the AP that HMRC tell them it was received. I would think that this is usually just going to be based on the date it’s paid.

In relation to holiday pay, I’m not sure that I follow the argument about what period the holiday pay relates to. Obviously you could advance a Reg 61(3) argument if the money was received a month ago, and the payslip is only now being issued to balance the books. But I’m not clear on how you could argue that money received today should sit in a previous AP - it goes against Reg 54, and doesn’t seem to touch on the sort of irrationality that we get in the four weekly pay benefit cap, and variable pay date cases.

I think you’re right that the best solution is to look at whether it will be better to delay the claim. If you get to advise them within a month of claiming, you might still be able to get them to cancel the claim and then make a new one again.