Holiday Pay

Entitlement

  • Almost all workers are legally entitled to 5.6 weeks paid holiday per year (known as statutory leave entitlement or annual leave).
  • Self-employed workers aren’t entitled to annual leave.

Working five days a week

  • Most workers who work a five-day week, must receive 28 days paid annual leave per year. This is calculated by multiplying
  • a normal week (five days) by the annual entitlement of 5.6 weeks.

Working part-time

  • Part-time workers are also entitled to a minimum of 5.6 weeks of paid holiday each year, although this may amount to fewer actual days of paid holiday than a full-time worker would get.

Example

  • A worker works three days a week, their leave is calculated by multiplying 3 by 5.6 which comes to 16.8 days of annual paid leave.

Irregular hours

  • If someone works irregular hours (eg shift work) they need to calculate their leave entitlement for irregular hours.

Limits on statutory leave

  • Statutory paid holiday entitlement is limited to 28 days.
  • Staff working six days a week are only entitled to 28 days’ paid holiday and not 33.6 days (5.6 multiplied by 6).

Bank holidays

  • Bank or public holidays do not have to be given as paid leave.
  • An employer can choose to include these holidays as part of a worker’s statutory annual leave.

Extra leave

An employer can choose to offer more leave than the legal minimum. They don’t have to apply all the rules that apply to statutory leave to the extra leave. For example, a worker might need to be employed for a certain amount of time before they become entitled to it.
Other aspects of holiday entitlement Workers have the right to:
  • Get paid for leave
  • Build up (‘accrue’) holiday entitlement during maternity, paternity and adoption leave
  • Build up holiday entitlement while off work, sick
  • Choose to take holiday instead of sick leave

Disputes

Paid annual leave is a legal right that an employer must provide. If a worker thinks their right to leave and pay are not being met there are a number of ways to resolve the dispute.

Holiday pay: the basics

  • Workers are entitled to a week’s pay for each week of leave they take.
  • A week’s pay is worked out according to the kind of hours someone works and how they’re paid for the hours. This includes full time, part time and casual workers.

Working pattern Pay

  • Fixed hours and fixed pay (part time or full time) – a week’s holiday pay equals how much a worker gets for a week’s work (excluding non-guaranteed overtime payments in most cases)
  • Shift work with fixed hours (part time or full time) – a week’s holiday pay equals the average number of weekly fixed hours a worker worked in the previous 12 weeks at their average hourly rate
  • No fixed hours (ie casual work) – a week’s holiday pay is the average pay a worker got over the previous 12 weeks (in which they were paid)

Calculating average hourly rate

To calculate average hourly rate, only the hours worked and how much was paid for them should be counted. Take the average rate over the last 12 weeks. If no pay was paid in any week, count back a further week, so that the rate is based on 12 weeks in which pay was paid.

Rolled-up holiday pay

Holiday pay should be paid for the time when annual leave is taken. An employer cannot include an amount for holiday pay in the hourly rate (known as ‘rolled-up holiday pay’). If a current contract still includes rolled-up pay, it needs to be re-negotiated.

More information

This is a general guide and doesn’t cover every type of working arrangement or all scenarios. For specific information about your holiday pay entitlement, contact the Advisory, Conciliation and Arbitration Service (ACAS).

Calculate leave entitlement

  • Annual leave begins to build up (‘accrue’) as soon as a worker starts their job.
  • An employer can use a ‘leave year’ or an ‘accrual’ system to work out how much leave their staff should get.

Download Here as a PDF