Calculating Holiday Entitlement for part time employees or workers with no fixed hours
All employees and workers, including those working part time or on a zero hours or casual basis, are legally entitled to a minimum of 5.6 weeks holiday per year. For someone working 5 days a week or more this equates to 28 days per year, including bank holidays.
Employers may choose to provide more generous holiday pay entitlements; for example, 25 days per year plus bank holidays which equates to 6.6 weeks.
So how do you calculate the entitlement for people who work part time or whose hours vary?
Part Time Employees – Fixed Days
If an employee works fixed hours and days per week but fewer than 5 days a week, their holiday entitlement should be calculated pro rata based on the number of days they work per week.
For example, for an employee who works 3 days a week every week where the full time entitlement is 28 days the calculation would be: 5.6 x 3 = 16.8 days per year including bank holidays
Where the employee works 4 days a week and the full time entitlement is 33 days, the calculation would be 6.6 x 4 = 26.4 days
Where the calculation is a part day, the employee can take a part day or you can round the entitlement up to a full day; you can’t round down.
Part time employees are entitled to be paid for bank holidays on a pro rata basis irrespective of the actual days of the week they work.
Part Time Employees – Fixed Hours per week
If an employee works a fixed number of hours per week but not necessarily fixed days or a fixed number of hours per day, then you will need to state their holiday entitlement as hours.
For an employee who works 20 hours a week every week where the full time equivalent is 28 days, the calculation is 5.6 weeks x 20 = 112 hours per year
Casual Workers or Zero Hours contracts
For employees or workers who have no guaranteed hours and whose hours vary week by week and month by month, you can calculate how many hours of holiday pay they have accrued every 12 weeks based on the number of hours that they have actually worked using a multiplier of 12.07%.
For example, if a casual worker has worked for 100 hours over the previous 12 weeks:
100 x 12.07% = 12.07 hours.
The worker can then choose when they take the holiday; they might ask to be paid it in the following pay period or could ‘bank’ it to take later.
You can use the government online calculator www.gov.uk/calculate-your-holiday-entitlement to do these calculations and to calculate entitlements for starters and leavers.
For employees or workers who do not fit in to any of the above groups, for example, workers whose pay varies depending on the amount of work done, there is further advice available at https://www.gov.uk/government/publications/calculating-holiday-pay-for-workers-without-fixed-hours-or-pay
But be warned it might blow your mind! Alternatively, you can contact us for any holiday pay query on our advice line.
In giving comment and advice in the article, we do not assume legal responsibility for the accuracy of any particular statement. If you have specific views which you wish to discuss, we would be pleased to assist you.