Loading…
Loading…
Work out the holiday a leaver has accrued but not taken, and what it is worth on the final payslip, with the 52-week average for anyone whose pay varies.
From the contract. Where nothing is agreed it runs from the anniversary of the start date.
Holiday accrues up to and including this day, so a notice period counts in full.
28 days is the statutory minimum for a five-day week, bank holidays included. Use the holiday entitlement calculator if the working pattern is irregular.
Optional. Include any days booked to be taken before the last day.
Holiday to pay in lieu
£0.00
Two steps: what was accrued by the last day of employment less what was taken, then what a day is worth. If the pay varies, the day rate has to come from the 52-week average, and that is where most final payslips go wrong.
The final payslip, worked out for you
Moonworkers tracks the holiday balance all year, settles it automatically on the last payrun, taxes each element the right way and files the leaver on the FPS.
Two halves: how many days are owed, and what a day is worth. The second is where final payslips usually go wrong.
Step 1
The full year’s entitlement, times the proportion of the leave year worked. Notice and garden leave count in full, because the employment has not ended yet.
Step 2
Including anything booked between now and the leaving date. A negative balance can only be recovered where a written agreement says so.
Step 3
Fixed pay divides straight through. Variable pay has to use the average of the last 52 paid weeks, skipping unpaid weeks and reaching back as far as 104.
Work out the entitlement itself with the holiday entitlement calculator, and the last day of employment with the notice period calculator.
Regulation 14 of the Working Time Regulations puts it as (A × B) − C: the holiday for a full leave year, times the proportion of the leave year worked by the last day, less the days already taken. Whatever is left is paid in lieu.
For someone on the same pay every week, the weekly pay divided by the days normally worked. For anyone whose pay varies, the average over the last 52 paid weeks, divided the same way. Weeks with no pay at all are skipped, reaching back up to 104 weeks to find 52 paid ones.
Yes, and during garden leave too, because the employee is still employed. The cut-off is the last day of employment, not the last day actually worked.
Yes, as ordinary earnings, with income tax and National Insurance through payroll. It gets none of the £30,000 exemption that applies to a genuine redundancy payment, which is why it has to be kept separate on the final payslip.
The employer can only recover the difference from the final pay if there is a written agreement allowing it. Without one, the overtaken days are simply lost to the employer.
No. Paying in lieu of statutory holiday is only lawful on termination. During employment the leave has to be taken, although an employer can require it to be taken at a particular time with notice of at least twice its length.
Statutory entitlement can be rounded up but never down. Trimming a balance of 3.4 days to 3 short-changes the employee, so leave it as it falls or round in their favour.
Since April 2024 they accrue holiday at 12.07% of the hours worked in each pay period rather than as a share of 5.6 weeks. Work the entitlement out with the holiday entitlement calculator first, then bring that figure here to price it.
Running payroll with leavers, statutory pay and RTI every month?
Try Moonworkers Payroll