How should employers calculate holiday pay, including for irregular hours?
Workers get a week's pay for each week of statutory leave, usually averaged over the previous 52 paid weeks where pay varies. For irregular-hours and part-year workers, leave accrues at 12.07% of hours worked in each pay period, and all their leave is paid at their 'normal' rate.
Entitlement
Almost all workers are entitled to 5.6 weeks' paid holiday a year, capped at 28 days. Someone working a regular 5-day week gets at least 28 days, which can include bank holidays. Leave keeps accruing during sick leave and maternity, paternity or adoption leave.
Working out a week's pay
For regular-hours workers, at least 4 weeks must be paid at the 'normal' rate and the remaining 1.6 weeks at a 'basic' rate. 'Normal' pay includes commission, regular overtime and payments linked to length of service or professional qualifications, but not usually bonuses.
- Regular hours and fixed pay: the worker's pay for a week.
- Shift work with regular hours: average weekly fixed hours over the previous 52 weeks at the average hourly rate.
- Irregular-hours and part-year work: average pay over the previous 52 weeks in which they were paid, counting back no more than 104 weeks.
Irregular-hours and part-year workers
For leave years beginning on or after 1 April 2024, these workers accrue leave at 12.07% of the hours worked in each pay period. Employers can use rolled-up holiday pay for them, but not for regular-hours workers.
Record keeping from April 2026
From 6 April 2026, employers must keep detailed records of annual leave and holiday pay for at least 6 years. Employers may be fined if they cannot show they keep holiday records.
The law
“at the rate of 12.07% of the number of hours that they have worked during that pay period…”
“a worker cannot, in any leave year, accrue more than 28 days of annual leave under this regulation…”
Sources
- Holiday entitlement · GOV.UK
- Calculating holiday pay for workers without fixed hours or pay · GOV.UK
- How much holiday someone gets · Acas
General information for employers in Great Britain, not legal advice. Check the official sources for your situation.
- Accrual rules for irregular-hours and part-year workers apply to leave years starting on or after this date
- Duty to keep annual leave and holiday pay records for 6 years
Future dates are expected dates and depend on Parliament.
What employers can do
- Identify which workers have regular hours, irregular hours or part-year contracts.
- Make sure regular overtime, commission and similar payments feed into 'normal' holiday pay.
- Set up the 12.07% accrual calculation for irregular-hours and part-year workers.
- Use rolled-up holiday pay only for irregular-hours and part-year workers, where it is permitted.
- Keep leave and holiday pay records for at least 6 years.
Recent tribunal decisions on this topic
Tribunal tracker- Milton Garden Machinery Ltd Breach of contractRedundancyUnlawful deduction from wages Read the decision on GOV.UK
- Brocket Hall (Holding) Ltd Breach of contractUnfair dismissalUnlawful deduction from wages Read the decision on GOV.UK
- BUPA Occupational Health Ltd Breach of contractUnfair dismissalUnlawful deduction from wages Read the decision on GOV.UK
Being listed does not mean a claim succeeded. Read the decision for the outcome; decisions can be reconsidered or appealed. If a listing concerns you, or a decision has since been anonymised or removed, tell us and we will review it and remove it where appropriate.
Related answers
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