If it does, read on for some important updates.
The rules came into effect last year but only impacted businesses whose holiday year started April 2024. For businesses whose holiday year is January to December the rules apply from January 2025.
Special rules apply to how annual leave is accrued for irregular workers, part year workers and during sickness.
Holiday will accrue, on the last day of the pay period, at the rate 12.07% of hours worked in that pay period.
There are 2 methods of calculating holiday pay:
- Default method When a worker takes holiday, you will pay them holiday pay based on their average earnings over the previous 52 weeks.
- Rolled up holiday method You pay the worker and extra 12.07% on top of their usual pay in each pay packet. This will represent their holiday pay, and you wouldn’t then pay them when they take holiday.
If the new rules are different to what you are already doing, then this will be a change to their terms and conditions and contract of employment.
Contact us for more information:
Email: hello@peachlaw.co.uk
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Call: 0161 478 3800
