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Chambers & Partners
15/02/1990

British Coal Corporation v Cheesbrough

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House of Lords

Appeal from CA decision that the method of calculating redundancy pay by para.3(3),sch.14, EPCA 1978 was correct. HELD: In assessing an employee's average hourly rate of pay where pay varied with the amount of work done the adjustment to be made by para.5(2) to correct a distortion of the average pay for normal hours which otherwise arose from payment of overtime rates was simply to deduct from the actual remuneration any element of overtime premium.It was not permissible for an employee who was paid a bonus for normal working hours,but not for overtime to have overtime earning reduced to normal rate including bonus. Per Lord Griffiths and Lord Brandon dissenting: It could not be the intention of Parliament that a man who worked overtime in the last 12 months of his employment should receive a smaller redundancy payment than a man who did the same work but refused overtime. Appeal dismissed.

[1990] 2 AC 256

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