Calculating holiday pay - Holiday entitlement

Calculating holiday pay

When an employee or worker takes holiday, they should get the same pay when they're on holiday as when they're at work – whatever their working pattern.

Some employers might offer better holiday pay schemes. You should check your contract.

Holiday pay calculations can be based on:

  • days or hours worked per week
  • casual or irregular hours
  • shifts

How a week's pay is calculated

For calculating holiday pay, a week usually starts on a Sunday and ends on a Saturday.

You should calculate your holiday pay from the last full week that you worked. This can end on or before the first day of your holiday.

You should only use another 7-day period if that's how your pay is calculated. For example if your pay is calculated by a week ending on a Wednesday, then you should treat a week as starting on a Thursday and ending on a Wednesday.

Your working pattern

How you calculate your holiday pay depends on your working pattern.

Fixed hours

If your working hours do not vary (part time or full time) your holiday pay will be calculated using your usual pay rate.

For example, if you work 37 hours every week and get paid £400 a week, when you take a week's holiday, you must get paid £400.

Work out holiday pay if you're paid monthly on GOV.UK

No fixed hours

If your work has no fixed or regular hours, your holiday pay will be based on the average pay you got over the previous 52 weeks. For example, if you do casual work on a zero-hours contract or shifts that change without a fixed pattern.

If for any of the 52 weeks you got no pay at all, use an earlier week in its place for calculating holiday.

If you get a small amount of pay for a week, for example statutory sick pay (SSP), you should use another week where you received your usual pay for calculating holiday. This is because you should get paid the same when you're on holiday as when you're at work.

You should only count back as far as needed to get 52 weeks of your usual pay. If necessary, you can look at the pay you got over the previous 104 weeks, but no further.

Important: For leave years starting on or after 1 April 2024, irregular hours workers and part-year workers will accrue holiday differently. Find out more about holiday pay and entitlement reforms on GOV.UK.

In the first year of your job

If you have not yet been employed for 52 weeks, your employer should look at how many full weeks you’ve been employed for.

For example, if you've been with your employer for 26 full weeks, your employer should look at the average pay you got during those weeks to calculate your holiday pay.

Find examples for working out holiday pay where there's no fixed hours or pay on GOV.UK

Pay for taking holiday before you've built it up

In the first year of your job, you may be able to take paid holiday before you've accrued (built up) enough holiday entitlement, if your employer agrees. For example, your employer might agree for you to take holiday soon after you start a new job.

They will not be able to calculate pay in the usual way, looking at your average pay from previous weeks. Instead, you should get an amount that fairly represents your pay for the agreed time off.

To work out what's fair, your employer should consider:

  • the amount you're paid for the job
  • the pay you've already received, if any
  • what others who do a similar job are paid for their holiday

What holiday pay must include

By law, holiday pay must include:

  • payments linked to doing tasks required in your contract, for example commission
  • payments related to professional or personal status, for example for length of service, seniority or professional qualifications
  • other payments, for example overtime payments, if you've regularly been paid these during the last year

Your employer must include any relevant payments in at least 4 weeks of your holiday pay.

Some employers might include these payments in your full 5.6 weeks' paid holiday (statutory annual leave), but they do not have to.

Rolled-up holiday pay

You must get paid for your holiday when you take it. If your employer is spreading your holiday pay over the year by adding an amount on top of your hourly rate, this is known as 'rolled-up' holiday pay and your employer should not do this.

Leave years starting on or after 1 April 2024

For leave years starting on or after 1 April 2024, employers can choose to use rolled-up holiday pay. This applies to irregular hours workers and part-year workers only.

Your employer should tell you if they're planning to use rolled-up holiday pay. Introducing this might involve changing your employment contract. There are procedures your employer must follow if they're changing the terms of your contract.

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If you think your holiday pay should be different

If you think you're not getting as much paid holiday as you're entitled to or are not sure how it's being calculated, you should talk with your employer.

Some employers might offer a better holiday pay scheme. You should check your contract.

If your employer does not correct the problem with your holiday pay, you could make a claim to an employment tribunal.

There are strict time limits for making a claim to an employment tribunal. In most cases, you have 3 months minus 1 day from the date of the most recent wrong holiday payment.

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Contact the Acas helpline

If you have any questions about calculating holiday pay, you can contact the Acas helpline.

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