Help & Guidance
Frequently asked questions
Holiday entitlement and holiday pay for irregular hours, part-year and zero-hours workers, based on the statutory rules.
Who counts as an irregular hours worker?+
A worker is an irregular hours worker if, under the terms of their contract, the number of paid hours they work in each pay period is wholly or mostly variable. Typical examples are zero-hours and casual contracts in hospitality, retail and care. A worker on a fixed rotating shift pattern does not qualify, because their hours are fixed even though they vary week to week.
How is holiday entitlement calculated for irregular hours workers?+
For leave years starting on or after 1 April 2024, holiday entitlement accrues at 12.07% of the actual hours worked in each pay period. The statutory method is: divide the hours worked by 100, multiply by 12.07, then round to the nearest hour (down if the remainder is under 30 minutes, up if it is 30 minutes or more). Statutory paid holiday is capped at 28 days a year.
Where does the 12.07% figure come from?+
All workers are entitled to 5.6 weeks of statutory leave, which leaves 46.4 working weeks in a year (52 minus 5.6). 5.6 divided by 46.4 is 12.07%. If a contract gives more than the statutory minimum, the percentage rises: divide the total entitlement in weeks by the remaining working weeks and multiply by 100. For example, 6 weeks of leave gives 6 divided by 46, which is 13.04%.
What is rolled-up holiday pay?+
Rolled-up holiday pay lets an employer add an uplift of at least 12.07% of total pay to every payslip, instead of paying holiday pay when leave is taken. It must be calculated on the worker’s total pay in the pay period, including overtime and commission, shown as a separate line on the payslip, and paid at the same time as pay for the work done.
Is rolled-up holiday pay legal in the UK?+
Yes, but only for irregular hours workers and part-year workers, and only for leave years beginning on or after 1 April 2024. For workers with regular hours it remains unlawful: they must receive holiday pay when they actually take leave. Employers introducing rolled-up holiday pay should check contracts first, as the change may amount to a variation of contract.
How does the 52-week average method work?+
Holiday pay is averaged over the last 52 weeks in which the worker was actually paid. Weeks with no pay, or weeks affected by sick leave or statutory leave such as maternity leave, are skipped and replaced by earlier paid weeks, looking back no more than 104 weeks. If fewer than 52 paid weeks exist, the average uses however many complete paid weeks are available. A week of holiday is then paid at that average weekly rate.
Which method should an employer choose?+
Rolled-up holiday pay is simpler to run: one percentage applied every pay period, with no reference period to maintain. It suits high-churn, variable-hours workforces. The 52-week average keeps pay attached to actual leave, which encourages workers to take their holiday. Both are lawful for irregular hours and part-year workers; whichever is used, the worker must not lose out financially for taking leave.
What payments must be included in holiday pay?+
Holiday pay must reflect normal remuneration. That includes commission linked to work the worker is contractually required to do, payments for professional or personal status such as length of service or qualifications, and overtime that has been paid regularly in the previous 52 weeks. Rolled-up holiday pay handles this automatically because the 12.07% uplift applies to total pay in the period.
What happens to accrued holiday when a worker leaves?+
Any holiday accrued but not taken by the termination date must be paid in lieu. Work out the remaining entitlement (accrued minus taken), then calculate the pay for that period. If the worker received rolled-up holiday pay throughout, their leave has already been paid as they worked, so no additional payment in lieu of statutory leave is normally due.
Does holiday still accrue during sick leave or maternity leave?+
Yes. For irregular hours and part-year workers, entitlement accrued during sick leave or family-related statutory leave is worked out from the average hours worked per week over a 52-week relevant period before the absence began, then accrued at 12.07% per week of absence. Workers paid rolled-up holiday pay must also receive holiday pay for these absences, based on average earnings over the same 52-week relevant period.
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