Staff at Butlins and Haven Holidays have won a landmark minimum wage ruling at the Court of Appeal.

HM Revenue & Customs (HMRC) took enforcement action against Leisure Employment Services – the employment arm of Bourne Leisure, which handles the seasonal staff at Butlins and Haven Holidays – over deductions taken from employees’ wages to cover utility bills.

According to HMRC, the deduction of £6 per fortnight from staff living on-site meant that pay fell below the national minimum wage.

Denise Gaston, national minimum wage business manager at HMRC, said: “This ruling is good news for all workers living in accommodation provided by their employer. It reinforces the fact that deductions for things like heating and lighting must not take workers’ pay below their legal entitlement.

The case was taken to the Employment Tribunal in 2005, but HMRC lost the case. The organization appealed to the Employment Appeals Tribunal, which ruled in favour of the HMRC in March 2006.

Leisure Employment Services then took the case to the Court of Appeal in January 2007 and lost.

In a statement, Bourne Leisure, which owns Butlins and Haven Holidays, said that it is concerned by the possible implications of the decision.

“The company is now concerned that supplying heat and light to live-in accommodation via meters means that Butlins will have no control over the vagaries of price hikes imposed by utility providers and that our employees may suffer unnecessary hardship.” Details: www.hmrc.gov.uk