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Almost all employees classed as workers are legally entitled to a minimum paid holiday a year which is also known as statutory leave entitlement or annual leave. This is a paid period off work that employees can use whatever they like with no loss in their salary. It applies to: 

How Is Paid Holiday Calculated? 

The annual leave is usually limited to 28 days for those, who work full-time 5-6 days a week. 
 
The duration for part-time employees can be calculated by the next formula: 

The number of their average weekly working days × 5.6. 

According to those, who work irregular hours, their holiday entitlement is calculated by the amount of hours they’ve worked in the previous 52 weeks × 12,07%. The result will be equal to the hours these people can take off. 

Holiday Pay 

The holiday pay is estimated according to the usual hours someone works. 

Payment in Lieu of Holidays 

Payment in lieu of holidays is not allowed, except for the termination of the agreement when the employee could not have taken all the holiday entitlement. 

Workers on Parental or Sick Leave 

Holiday entitlement builds up during certain types of leave, including maternity, paternity, adoption, or sick leave. 

Booking Time Off 

Before taking time off the employee has to inform the employer about that. Here it’s better to keep in mind that the sooner the worker tells about the leave, the better. The notice should be no less than twice as long as the amount of days off the employee wants to take, plus one day. So, for example, if the person wants to take 5 days off, he or she should inform the employer in 11-day time.  

It’s also vital to remember, that the employer has the right to refuse the request and notify the employee about their decision no less than the amount of days off the employee wants to take, plus one day. So, if the employer doesn’t agree to give the leave for 5 days, the employee has to be notified about that 6 days before or earlier. 

When Leave Can and Can’t Be Taken 

There are such periods, when employees aren’t allowed to take paid leave. These situations are usually specified in the employment contracts and are referred to as busy periods that vary depending on the industry. There might also be cases when employers notify their employees of the days when it’s better to take a paid holiday or even require them to use their leave within a certain timeframe or lose it. 

Bank Holidays 

Bank holidays do not have to be given as paid leave. An employer can choose to include bank holidays as part of a worker’s statutory annual leave. 

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Employers should be aware of and adhere to the legal requirements that are mentioned above. To avoid legal consequences and ensure fair treatment, AdminTech suggests:  

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Each employer has to adhere to the regulations according to the minimum wage. This amount is set by the government to make sure that workers can receive enough money to cover their basic needs. Any social security contributions and taxes payable by the employer apply to the minimum wage and not to the lower actual wage. The minimum wage is often changed from one year to the next, requiring regular employment contracts to be adapted. 

National Minimum Wage in the UK  

The employee needs to be at least of a school leaving age to qualify for the National Minimum Wage (NMW). The rate is divided into different age brackets, with lower rates for younger workers. The NMW applies to most workers, including those who work full-time and part-time. 

National Living Wage in the UK 

Workers aged 23 and over are entitled to a higher minimum wage rate which is also called the National Living Wage (NLW).  

Apprentices 

Apprentices are entitled to the reduced apprentice rate if they’re either aged under 19 or for the first year of their apprenticeship, but in no case if they are of at least of the qualifying age for the NLW as indicated above. 

NMW and NLW Don’t Apply to 

There are certain categories of people that aren’t entitled to get NMW or NLW. These include: 

Current Rates 

As for today, the wage looks the following way.  

23 and over 21 to 22 18 to 20 Under 18 Apprentice 
£10.42 £10.18 £7.49 £5.28 £5.28 

However, the rate changes every year, and from 1 April 2024, the amounts will be slightly different. 

21 and over 18 to 20 Under 18 Apprentice 
£11.44 £8.60 £6.40 £6.40 

Amounts taken into account for calculating the minimum wage include: 

Amounts not included in the calculation of the minimum wage: 

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Employers in the UK who fail to pay the minimum wage may face legal penalties. To avoid this, AdminTech suggests: 

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You can always modify your employment contract and the wage that is included there using valid document templates. Just fill in the needed information, save it, and come to your employment contract whenever you want to edit any detail.  

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Employment status outlines the nature of the business relationship, classifying people according to the terms and conditions of their employment. These statuses slightly differ in obligations, taxes, social security, etc. Subsequently, business documents used for cooperation between two parties are also unlike. 

As you see, there is no straightforward definition of what it means to be employed or self-employed. So, a case-by-case assessment is necessary. 

The person is likely to be an employee if he or she: 

Things differ once the person is self-employed, while he or she: 

Please note: these criteria are not cumulative, and each criterion may carry more weight than the others, depending on the individual situation. 

Employment Rights of Employees and Self-Employed in the UK 

Employees are protected by labor laws and have the following rights: 

Since self-employed people are their employers, they fall outside the scope of employment law. Still, however, they have: 

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During the hiring process, regulations also slightly differ. So, if you decide that a particular person will work for you as a self-employed individual, it’s advisable to: 

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In the situation of hiring a person as an employee, one of the main points is to establish a valid employment contract that will help to ensure clarity, compliance, and a positive working relationship between both parties.  

You can take advantage of our legal employment contract templates and adapt them to the type of work and the employee. Just navigate the rules of employment law with our information boxes, which provide guidance and make your work fast and secure. 

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AdminTech team is always ready to help you with legal agreements and ensure their legal compliance.