Holidays and hours at work - Holidays and Holiday Pay

Under the Working Hour Regulations employees are entitled to four weeks paid holiday a year. Bank holidays are not an additional right (see opposite indexed page). Employers are of course free to offer additional holidays indeed the typical UK holiday entitlement would be 4-5 weeks plus bank holidays.

Holiday pay should be set at the normal weekly pay level. If there is a significant variation normal pay can be calculated as the average over a period of 12 weeks.

Casual/ agency staff are entitled to the same holidays as permanent employees. Part-time employees are entitled to the same holiday calculated pro-rata.

Employees aged 16 years and under are entitled to take two weeks holiday during the school holidays.

Employees have a right holiday pay for those parts of their entitlement not taken on termination of employment. This applies even if the worker is dismissed. Similarly if an employee has taken more than their pro-rata holiday entitlement final salary can be reduced to take the excess days into account.

Employees are entitled to paid holiday from the day they start work. But apart from a specific agreement at the time of recruitment, most employers require employees to work at least a month before they take any holiday. In that case holidays accrue pro-rata according to the weeks worked.

If part of the four week entitlement is not taken during the year there is no obligation upon the employer to carry-over untaken holiday to the next year. However to give both parties some flexibility most employers have a policy of carry-over of say 5 days but will often place a condition as to the taking of that holiday early in the new holiday year.

Employers are well-advised to have a clear written policy on holidays. This should cover:

Calculation of annual leave entitlement
Carry-over of holidays
Policy on unpaid leave
Holiday entitlement if on sick leave
Holiday pay on termination of employment.