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Holiday Entitlement in the UK

Know the legal framework of holiday entitlement and how holiday allowances are calculated. Stay informed according to the right balance between work and leisure in the UK.
Holiday Entitlement in the UK: How It Works and Calculates
21.05.2024

Employee’s minimum paid leave in the United Kingdom

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: 

  • agency workers 
  • workers with irregular hours 
  • part-year workers. 

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. 

  • Those employees who have fixed hours of their full-time or part-time work should get the typical pay that they would earn without taking days off. 
  • Those employees who do shift work with fixed hours are entitled to get their pay according to their average hourly rate for the previous 52 weeks. 
  • Those employees who have no fixed hours have the right to get their average pay during the previous 52 weeks. 

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. 

AdminTech Recommends

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:  

  • Determining whether the paid leave shall be inclusive or in addition to the bank holidays. 
  • Using the government holiday entitlement calculator to find out the minimum leave required by law.  
  • Recording hours worked, sick leave, absences, holidays, public holidays, and any other payroll information. 
  • Notifying employees about the specifics of holiday entitlement in both oral and written forms. 
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