More than 370 insurance agents with the Royal Liver Assurance company have been awarded £2.8 million (€3.5 million) by the Labour Court in a decision that could have implications for thousands of other people who work as agents on commission for companies.

Such agents will now be able to claim holiday pay for the nine public holidays, and 20 days minimum statutory leave in the same way as other employees whose income is wage- or salary-based. Royal Liver was reserving its position on the award yesterday and said it might appeal.

The case was brought by SIPTU on behalf of 271 members, but another 100 non-unionised agents will also benefit if it is accepted by the company.

Royal Liver said the decision had no implications for its operations in Britain, as employees were retained on a different basis to Ireland.

SIPTU branch secretary Mr John Swift welcomed the court's decision, which upholds an earlier determination by a Rights Commissioner in favour of the agents.

"We estimate the recommendation is worth in the region of £800,000 a year to our members, and other agents will also benefit."

He put the arrears due at around £2 million.

"But more importantly, we have established the right of 271 SIPTU members to paid annual leave and public holidays under the Organisation of Working Time Act. The management at Royal Liver Assurance had refused to recognise the fact that our members had a legal right to paid holidays as well as public holiday pay."

The ruling is based on the 1997 Organisation of Working Time Act, which was introduced to comply with the EU working time directive.

Agents receive a small retainer from the company but their main earnings are from the 12.5 per cent commission paid on amounts collected.

Some earn as little as £9,000 but others earn more than £90,000. Average earnings are £25,000.

In the past, they were not paid for public holidays or days taken off for holidays. Royal Liver argued at the Labour Court that agents did not work public holidays and there was no specific agreement to pay them for time taken off for holidays - although there is a company scheme that provides repayable staff loans.

Agents could also collect commissions early or after their holidays.

The company therefore argued that claimants were in a position to recover the full amount they would have earned by working normally during the year.

The court said a test case brought to the European Court of Justice earlier this year by the Broadcasting, Entertaining, Cinematographic and Theatre Union in Britain had established paid annual leave as "a fundamental social right, which is characterised in the Directive as an automatic and unconditional right granted to every worker".

The term "paid annual leave" was not defined in the Irish Act or the Directive, but the court ruled that it was "a term of common usage in industrial relations and is well understood as meaning a period of rest or relaxation during which a worker is paid his or her normal wages without having any obligation to work or provide any service to the employer".

The court accepted agents could collect commission on money collected in arrears after returning from holidays, but this did not constitute an "automatic and unconditional right to paid leave". It said the arrangement operating at Royal Liver amounted to "leave of absence" rather than annual paid leave.

On the public holidays issue, the court said agents who decided not to work those days still had to collect the policy payments on other days, so that the total amount of time spent on collections was the same during weeks with public holidays as those with no public holidays.

It said the agents were entitled to be paid compensation from April 1999.