One of the most frequent questions we get asked is how to work out an employee’s holiday allowance.
And that’s not surprising, because so many different variables mean that calculating staff entitlement can be really complex.
Whether it’s too much or too little that’s been miscalculated, admin errors aren’t just inconvenient or a bit embarrassing but could carry serious consequences for employers who get it wrong. Incorrectly calculating holiday pay is an unlawful deduction of wages and can result in costly claims that can be backdated by up to two years.
WorkSmarter’s
Holiday Planner not only calculates everything for you, so there’s nothing left to worry about, but also adjusts to the way different businesses operate their holiday and staff leave policies. Whether you track holiday by days or hours, roll over unused time, or grant TOIL – our clever system adapts to suit you.
How Much Holiday are Employees Entitled to?
Check out this quick and easy summary from
Robinson Grace HR Consultancy, one of WorkSmarter’s team of professional HR Partners who can provide customers with expert support and guidance on HR and employment matters.
- Employees and workers must receive (at least) the statutory 5.6 weeks’ paid annual leave per annum. Check whether there is a contractual entitlement to receive more than that.
- Bank holidays can be included within the statutory allowance of 5.6 weeks per year.
- There is no statutory requirement to pay or offer leave on bank holidays.
- Part-time employees must be treated no less favourably than full-time. So, if you pay full-time employees for bank holidays in addition to the statutory minimum, you must ensure the rest of your workforce receives the same entitlement, regardless of whether they would be working the bank holiday days or not.
Good to Know
✔️Employees starting part-way through your holiday year have their holiday entitlement calculated from the date they join.
✔️ For employees leaving part-way through your holiday year, the period of entitlement runs from your holiday year start date through to their leaving date.
Their annual leave entitlement is based on the amount of time employed with you. If they’ve taken more than their annual leave entitlement at the time they exit the business then you can take the money back in their final pay - as long as it has been agreed in writing beforehand. If they’ve taken less than their entitlement by the time they leave, you may be able to offer them payment in lieu of holiday.
Employing Staff on a Range of Contracts
Calculating annual leave for full time employees is relatively simple, though there can be some variables. However, it becomes complicated when it comes to all the other different types of contracts:
· Part timers.
· Zero Hours Workers.
· Shift workers.
· Annualised hours – for example, agricultural workers who carry out seasonal work.
· Casual workers.
· Staff who work irregular hours (including as a result of regular overtime).
· Staff who work a fixed number of hours each week but not the same number of hours each day.
With so many different variables and categories for working out holiday entitlement, calculating everything correctly can be a real head scratcher - even taking into account universal numbers such as how many holiday days per holiday year your business grants and if this does or doesn’t include bank holidays.
This is when a good online employee leave planner becomes so valuable.
WorkSmarter’s cloud-based software not only provides a truly user friendly system built specifically for SMEs, but also offers a wealth of powerful features that make
holiday planning and other HR tasks simple, quick and compliant.
Some Considerations When Calculating Holiday Entitlement
- Your business decides if employees work bank holidays or not, and whether bank holidays form part of their holiday entitlement or are additional to it.
- In the first 12 months of a job, staff accrue leave at the rate of 1/12 per every month worked.
- An employee will still build up leave even if on maternity, paternity, adoption or sick leave.
- Staff on maternity leave can’t take holiday or get holiday pay while on maternity leave but can carry their unused holiday entitlement over into the next holiday year. Often employees may request to tag on some or all of their entitlement accrued during the leave to the end of the leave period.
- Staff on long-term sick leave can carry over four weeks' unused holiday entitlement, more if you allow. This holiday must be used within 18 months from the date it's carried over.
- You may have some employees that need to calculate holiday by hours rather than days, for example those who work compressed hours or do working days of different lengths.
- When calculating the statutory minimum leave entitlement, you must not round the entitlement down (and in certain circumstances it must be rounded up)
WorkSmarter Does the Heavy Lifting
It’s not possible to predict every single possible circumstance that could affect employee holiday calculations, but even the most usual ones can be complex.
That’s why thousands of SMEs prefer to let WorkSmarter’s dynamic Holiday Calculator do the hard work for them.
With calculations based on UK holiday entitlements, all the hassle and complications are removed when you use our calculator.
The calculator automatically sets itself for the employee’s individual work schedule with your company’s standard numbers already pre-filled: for example, how many holiday days you grant, how many days are in your full-time working week and so on.
Simply provide the basic key employee information, click calculate and the job’s done.
- Calculates start dates.
- Calculates leave dates.
- Calculates how many days an employee works.
- Calculates in days or hours.
- Automatically accounts for bank holidays based on preferences that apply to the specific user – so if some staff work bank holidays and others don’t, we’ll take that into account.
- Customised for each employee.
WorkSmarter calculations are based on UK holiday legislation, but of course some employees may be subject to different requirements. For more information, please refer to the
full guidance at Gov. UK.
With WorkSmarter’s holiday planner, staff are clear about how to book precious time off using an intuitive and easy process.
Schedule conflicts are avoided, allowances won’t be exceeded, and everyone’s kept in the loop with the shared holiday calendar. Happy holidays!
Transformational Software
Created and run by experienced business owners and experts in their fields, WorkSmarter offers an easy and affordable way to manage daily people tasks and connect teams.
Want to know if WorkSmarter’s a good fit for your business? Book a no-obligation
demo and get your first 3 months’ free.
