Changes to Holiday Entitlement and Pay

Every worker is entitled to 5.6 weeks’ paid annual leave – 4 weeks are provided under European Law and an additional 1.6 weeks from our own domestic laws. The 1.6 weeks represents the number of bank holidays in England but leave does not necessarily have to be given out on those day.

Working out part time staff’ entitlements can be trickier – they work on a pro rate basis. For example someone who works 3 full days a week would get just under 17 days annual leave.

Holiday pay must be calculated based on ‘normal remuneration’. If employees work the same hours each week, this is relatively simple – holiday is paid as if they had been at work.

However, where staff work irregular hours or pay varies depending on which hours are worked or the amount of work done, the situation is not so straightforward. A week’s pay is calculated by reference to the average of what was paid to the employee over the previous 12 weeks. Depending on the working arrangement, commission and overtime sometimes need to be taken into account calculating the rate of pay.

Source: The Business Magazine

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